International Business Machines (NYSE:IBM) CEO Ginni Rometty said in late 2016 that Watson, the company's artificial intelligence (AI) platform, would be used by more than 1 billion consumers, directly or indirectly, by the end of 2017. Healthcare may be the biggest opportunity, with Watson involved in a slew of initiatives aimed at improving patient outcomes.

IBM took one more step this week in its quest to grow Watson. The company, along with video game engine developer Unity Technologies, announced the launch of the IBM Watson Unity software development kit. The SDK allows developers using the Unity game engine to integrate Watson services into their games and applications. The SDK itself is free, with IBM charging for each call to a cloud-based Watson service.

IBM's Global Center for Watson IoT in Munich, Germany.

Image source: IBM.

Not just games

Unity has become a popular choice for game developers, but the engine is also used to build business applications. Examples listed on Unity's website include a teaching aid for the construction and engineering industries, training tools for healthcare workers, and an augmented reality app for viewing and customizing high-end cars.

Watson may be most useful in virtual reality (VR) and augmented reality (AR) applications. The Watson speech-to-text service would allow an application to respond to a user's voice, triggering in-game events or navigating the interface of a VR or AR application. Other Watson services include language translation, language classification, and tone analyzer, all of which could be used to improve how users interact with an application.

Watson is already being used in one game, Star Trek: Bridge Crew. Using Watson, the virtual reality game allows the player to issue voice commands to AI characters. It uses Watson speech-to-text and conversation services to implement this functionality.

Joining Amazon and Microsoft

IBM is not the first cloud computing company aiming to get its cloud services into games and other visual applications. Amazon (NASDAQ:AMZN), the dominant leader in public cloud infrastructure, offers its own game engine free of charge. Amazon Lumberyard is tightly integrated with Amazon Web Services and Twitch, allowing developers to tap into Amazon's vast array of cloud services, including various AI services.

Amazon also offers GameLift, an on-demand service offering dedicated servers for multiplayer games. GameLift supports major game engines, including Lumberyard, Unity, and Unreal Engine.

Microsoft (NASDAQ:MSFT) also pushes its own cloud platform for use in games, on top of selling Xbox video game consoles and developing games itself. One notable example: The upcoming Xbox One title Crackdown 3 will use Microsoft's Azure cloud platform to offload physics calculations in multiplayer matches, allowing for many times the processing power of a single Xbox One to be available.

IBM's efforts are specifically geared toward enabling AI in games and other applications, instead of offering raw computing power. But that fits in with IBM's overall cloud strategy of focusing on high-value services.

A small step for Watson

IBM doesn't break down how much revenue Watson generates, but its cloud business is booming. IBM's cloud revenue reached $17 billion in 2017, up 24% compared to 2016. Cloud delivered as a service reached an annual revenue run rate of $10.3 billion, up 20% year over year.

IBM sees AI as a massive, long-term opportunity. Rometty, in an interview with The New York Times, said that AI "is the opportunity of our time." This Watson-Unity collaboration won't move the needle for IBM on its own. But it's another step in IBM's plan to transform itself into a cognitive computing powerhouse.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Teresa Kersten is an employee of LinkedIn and is a member of The Motley Fool's board of directors. LinkedIn is owned by Microsoft. Timothy Green owns shares of IBM. The Motley Fool owns shares of and recommends Amazon. The Motley Fool has a disclosure policy.