In 1997, IBM's (NYSE:IBM) "Deep Blue" computer defeated world chess champion Gary Kasparov. In 2011, the company's "Watson" computer wiped the floor with the smartest humans on Jeopardy!. And most recently, IBM unveiled the next step in its artificial intelligence mission: Project Debater.

IBM Debater does exactly what its name says: It debates humans. If you think about it, debating is a big step up in complexity from the mere speed and processing power which led to IBM's chess and Jeopardy! victories. Computers have traditionally been unable to interact with that level of nuance. Could Project Debater finally be the inflection point for both artificial intelligence (AI) adoption and IBM's stock?

Computer, please approach the bench

IBM Debater faced off against two humans: Dan Zafrir, president of the International Debate Society in Israel; and Noa Ovadia, who is the 2016 National Israel debate champion. There were two short debates, one on telemedicine, and another on funding space exploration. Each one was structured with an introduction, four-minute rebuttal, and a concluding statement.

The computer apparently "held its own" against these formidable opponents, winning over some audience members and even cracking a few jokes along the way. "There is a lot at stake today ... especially for me," Debater quipped. Its analogies were also impressive: "Subsidizing space exploration is like investing in really good tires. It may not be fun to spend the extra money, but ultimately you know both you and everyone else on the road will be better off." 

A hologram brain hovering over an empty suit

Image source: Getty Images.

How the Debater works

Project Debater came from an IBM team based in Haifa, Israel, which started the project around 2012. Debater uses a complex mix of algorithms to accomplish the task of seeming human.

First, the computer must interpret human speech with advanced voice recognition technology. Then, Debater scans a database of millions of academic papers, news articles, and other written pieces on the topic, sifting out relevant passages that pertain to the argument at hand. Another step entails the computer eliminating repetitions in these passages, before finally interpreting them and forming an argument. Debater can even take things a step further, giving itself a confidence score, then debating either more forcefully or not, depending on how confident it is in its argument.

Will Debater turn IBM's fortunes around?

IBM is betting big on artificial intelligence and big data to bring it through its current business transition. Still, ever since the company's Watson Jeopardy! win, IBM's business has failed to win in a similar fashion. Last quarter, the cognitive solutions segment, which includes Watson (along with a host of other analytics technologies), grew only 2%. That doesn't exactly scream "disruptive technology" to investors, especially seven years after the Jeopardy! success.

There are several possibilities as to why. One, some have wondered how differentiated Watson is compared with other artificial intelligence services from Silicon Valley companies both large and small. Second, IBM has tried to apply Watson to incredibly difficult problems, such as diagnosing cancer. Since collecting all the relevant medical data is challenging, delays in breakthroughs have tested investor patience. Finally, the fact that IBM has been hyping the technology for years, yet doesn't disclose how much money it makes specifically from Watson applications, probably doesn't help matters.

Can Debater combat our biggest problems?

Debater, for now, is just another IBM research project. Still, one can think of several future applications for business. For instance, lawyers might use Debater to help form and refine arguments. Debater could also help in large classrooms where a teacher might not have the time for sufficient one-on-one interaction with students. 

IBM, in its typical fashion, points to even more grandiose ambitions. On the Project Debater site, IBM writes:

The rise of one-sided and doctored narratives is challenging society and our platforms. Too often, we talk past one another. We need a smarter way. New developments in language and reasoning in AI can help shine a light in the darkness of distorted facts to provide diverse, well-informed viewpoints -- both the pro and the con. 

Now, that's interesting. When you consider Facebook's fake news troubles during the 2016 election, leaving it with the difficult task of deciding what is and is not "legitimate" news, could IBM's technology help in those efforts? Could Debater have broader applications to future news coverage, or even future political debates?

These are all fascinating questions and reveal what an interesting age we live in. While IBM's stock price doesn't reflect it, Debater is evidence the company is still pushing forward on cutting-edge AI technologies. Whether that will translate into revenue and profits is an open question, but it's definitely worth paying attention -- especially with IBM's stock trading at a forward P/E ratio of just over 10x.

Billy Duberstein owns shares of FB and IBM. His clients may own shares of some of the companies mentioned. The Motley Fool owns shares of and recommends FB. The Motley Fool has a disclosure policy.