Xerox Corp. research subsidiary Palo Alto Research Center (PARC) has struck a licensing deal with Powerset Inc. in San Francisco. The two are developing a search engine based on natural language processing, in hopes that they can take on Google with an end-of-the-year release. In addition to the licenses, Powerset also holds the patents to the technology and is funding the natural language processing research team"s efforts at PARC while PARC receives equity in Powerset and royalties on company revenue. Powerset, which has raised $12.5 million in funding from various venture capital firms and angel investors, has been negotiating with PARC to use the technology the research firm developed since September 2005.
Powerset founder and CEO Barney Pell explained that a search engine powered by natural language processing technology, unlike typical search engines that index by keywords but do not understand their relationship, can accept queries written as people normally speak. For example, "What company did IBM acquire in 1996?" would directly answer the question without displaying every indexed site with the words "acquire," "IBM" and "1996". It"s true the major Web search engines such as Google do question-and-answer type searches today, Pell said, but they are still mainly based on keywords. Researchers have been working for 30 years to come up with successful natural language processing technology, and Pell acknowledges the complexity of the challenge: "Enabling computers to extract meaning and relationships in text ... is an incredibly hard problem."