Microsoft acquires AI and bot development house XOXCO

Microsoft is acquiring XOXCO, a conversational-AI development firm known for its Howdy.ai bot tools for Slack.
Written by Mary Jo Foley, Senior Contributing Editor

Microsoft is acquiring conversational AI and bot development software vendor XOXCO Inc. for an undisclosed amount. Microsoft announced its acquisition plans on November 14, the same day it is going public with a number of other AI product and service announcements.

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Austin, Texas-based XOXCO was founded in 2008. Since 2013, the company has been working on conversational AI.

Among its products are Howdy.ai, which Microsoft describes as "the first commercially available bot for Slack that helps schedule meetings." Howdy assists with the creation of custom bots, including bots for work chat, bots for customer support and bots for marketing. XOXCO also sells Botkit, a collection of development tools for those working on GitHub. Microsoft has partnered with XOXCO for a number of years.

Microsoft isn't saying how it will integrate XOXCO into the rest of the company or what it plans to do with Howdy on Slack. However, announcement of the XOXCO acquisition was made by Lili Cheng, who is the Corporate Vice President of Conversational AI at Microsoft -- and who recently moved from the Research and AI group at the company to the Devices and Experiences team.

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During the last six months, Microsoft has bought a number of AI development companies, including conversational AI-focused Semantic Machines in May; reinforcement learning and simulation vendor Bonsai in July; and deep learning and AI model specialist Lobe in September.Microsoft has been working on various conversational AI projects over the last few years.

On the bot front, it launched (and closed down) its Tay.ai bot, and continues to work on other AI bots including Xiaoice, Ruuh, Rinna and Zo.ai. Microsoft has been promoting the full-duplex chat capabilities of Xiaoice this year. Microsoft is working to reposition Cortana, its personal digital assistant, as more of a productivity aide than a standalone assistant.

Microsoft officials continue to bet on the idea that natural language will become the new user interface at some point.

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In other conversational-AI news, Microsoft is releasing suggested guidelines which are designed to help customers think about ways to develop bots and other conversational AI tools responsibly. The guidelines were derived from Microsoft's own experiences developing tools such as Cortana and Zo and cover topics including designing bots related to employment, finances, physical and mental well-being, along with other sensitive uses.

Microsoft also is moving a number of its translation technologies out of its labs and into commercial products, officials said this week. The company is making available a preview in Azure Cognitive Services a neural text-to-speech synthesis system that generates digital voices from text. "The technology can be used to make interactions with chatbots and virtual assistants more natural and engaging, convert digital texts such as e-books into audiobooks and enhance in-car navigation," according to Microsoft's blog post.

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