• by Laurie Sullivan , Staff Writer @lauriesullivan, March 26, 2010

Lexalytics added a cloud computing reputation management service to its traditional in-house platform. It gives small companies the ability to monitor buzz about them across the Web.

The Web services platform, Lexascope, lets marketers make API calls across the Web using standard HTTP grammar, explains Seth Redmore, vice president and engineer behind the platform. Redmore helped build Cisco Systems' text analytics and business intelligence system after the telecommunications company acquired Netiverse, a company he co-founded.

"You give the platform a piece of text and it tells you who is being discussed, the context of the conversation, such as the prevalent themes, and the sentiment and tonality," Redmore says.

Lexalytics competitors include Clarabridge, Attensity, and Temis, but I can't confirm all have offerings in the clouds.

Marketers that haven't looked into installing and managing Web services might not know that applications running on servers, also known as cloud computing, cost much less than purchasing hardware and installing software on in-house servers. Think of cloud computing as a co-op where people pull resources to share processing power, which gives them a better price on the service.

To install and manage the hardware for an in-house system like Lexascope would cost between $50,000 and $100,000 per yearly license. In the cloud computing model, the service would run $400 monthly. This is why Amazon, Google and Microsoft continue to push cloud computing.

As a Web service, marketers can "inexpensively" integrate Lexalytics' sentiment analysis tool into their own business intelligence (BI) applications, but the out-of-the-box Web service has limitations. "There's limited customization features on the Web services version," Redmore says. "If you install and run the software yourself you can customize the sentiment analysis. The ability to identify relationship between entities is only available in the software you install on-site."

The relationship management feature works like this: John Chambers is the CEO of Cisco Systems. Lexascope will extract that relationship and tell marketers that Chambers works at Cisco, and Chambers is the CEO. Marketers expecting news can, for example, monitor automated analysis of mergers.

Redmore tells me in-house systems might work best for businesses that take in hundreds of thousand of confidential documents and might face regulatory issues, or want to customize platforms to hand-tag confidential information.

Lexalytics built the cloud computing service because of demand from customers to build a less expensive, lightweight Web service that would mine and analyze social media and online content as well as internal documents. The company's core in-house software system, Salience, supports the Ciscos of the world, which crunch more than 100,000 documents daily -- but it's not necessarily a perfect fit for small and mid-tier companies looking to keep informed of online content written about them.