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How Apple Will Benefit From Twitter's Firehose

By Erin Kennedy and Evan Niu, CFA - Dec 7, 2013 at 7:00PM

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With the acquisition of Topsy, Apple moves deeper into the business of data.

Last week, Apple (AAPL -0.23%) acquired social media data analytics firm Topsy for a reported $200 million. Topsy specializes in analyzing Twitter data, and is one of the customers of Twitter's data licensing business, where it sells access to its "Firehose." Apple has failed it almost all of its attempts to be social, so it's leaving social media to the experts.

While Apple usually tends to acquire small companies that may help add features to future devices, this acquisition is clearly geared toward data. Compared to some of its heavyweight rivals, Apple has fewer ways to gather valuable customer data. Apple knows a lot about content trends thanks to iTunes, but this acquisition can broaden its view of what's trending. That information can be used to bolster Siri, iAd, iTunes, and a slew of other services.

In this segment of Tech Teardown, Erin Kennedy discusses Apple's latest acquisition with Evan Niu, CFA, our tech and telecom bureau chief.

Erin Kennedy owns shares of Apple. Evan Niu, CFA, owns shares of Apple. The Motley Fool recommends Apple and Google. The Motley Fool owns shares of Apple and Google. 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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