IBM: Desperately Seeking Skynet

"The Skynet Funding Bill is passed. The system goes online August 4th, 1997. Human decisions are removed from strategic defense. Skynet begins to learn at a geometric rate. It becomes self-aware at 2:14 a.m., Eastern time, August 29th. In a panic, they try to pull the plug ... "
-- Arnold Schwarzenegger as the Terminator in Terminator 2: Judgment Day

So far as we know, Skynet remains a fictional creation. And yet, if IBM (NYSE: IBM  ) has its way, a machine capable of thinking as a human might isn't far off. A prototype chip created in Big Blue's labs possesses the ability to make decisions from synthesizing massive amounts of data.

IBM calls the potential breakthrough cognitive computing. By reverse-engineering the brain's ability to learn through experience, find correlations, create hypotheses, and distill lessons from outcomes, Big Blue said in a press release that it's hoping to create a chip that yields "many orders of magnitude less power consumption and space than used in today's computers."

Killer machines, in other words, wherein "killer" acts as a synonym for "unbelievably awesome."

Fascinating? No doubt. It's initiatives like these that demonstrate just how different IBM is from Hewlett-Packard (NYSE: HPQ  ) and other peers, especially now that CEO Leo Apotheker is cutting consumer-facing operations to focus on big-ticket sales. Reverse-engineering brainpower would have to seem like a frivolous enterprise.

And it would be for IBM, too, if the company hadn't already transformed its innovation engine into a profit machine. Big Blue takes in some $1 billion annually in patent royalty revenue at last count. Grants are also part of the revenue equation.

For cognitive computing, IBM and its university research partners have been awarded $21 million in grants from ... wait for it ... the Defense Advanced Research Projects Agency, otherwise known as DARPA. It's an arm of the United States Department of Defense tasked with designing (ahem) crazy advanced weaponry.

Page Sarah Connor. Find Miles Dyson. Load up on canned goods. Skynet may not be on the immediate horizon, but IBM just took us one giant step closer. Do you agree? Disagree? Weigh in using the comments box below. You can also add IBM to your watchlist for up-to-date analysis on the stock as soon as it's published.

Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team. He owned shares of IBM at the time of publication. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Google+ or Twitter, where he goes by @milehighfool. You can also get his insights delivered directly to your RSS reader.

The Motley Fool owns shares of IBM. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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