• by Gavin O'Malley , Staff Writer @mp_gavin, February 3, 2016

Why is Microsoft is dropping $250 million on keyboard app maker SwiftKey? I mean, the company’s phones could use plenty of improvements, but a better keyboard ain’t one of them. 

The deal clearly has more to do with SwiftKey’s artificial intelligence assets -- which supported the recent launch of an Android keyboard that uses a neural network in place of standard algorithms to predict one’s word selection.

As a source close to the deal told The Financial Times: “There’s a war for talent in artificial intelligence.”

To that end, Apple recently bought Perception -- a startup that specializes in technology for companies that want to run advanced artificial intelligence systems on smartphones.

In general terms, Harry Shum, EVP of technology and research at Microsoft, admitted that AI lay at the heart of the deal.

“SwiftKey’s predictive technology aligns with Microsoft’s investments and ambition to develop intelligent systems that can work more on the user’s behalf and under their control,” Shum said on a blog post.

And don’t forget that Microsoft has been baking AI into its strategic game plan for some time. Along with its personal assistant, Cortana, the software giant has been exploring AI’s marketing potential. About a year ago, for instance, Bob Bejan, VP of North American sales & marketing at Microsoft, told me how the technology was revolutionizing adverting.  

More broadly, Forrester analyst Thomas Husson recently said that AI is top-of-mind for many brands and technology platforms.

Yet exactly what Microsoft has in store for SwiftKey remains to be seen.