Yahoo leaps toward AI-powered news with Artifact acquisition

Yahoo has long been a major player in news. And it’s now doubling down with an acquisition.

Yahoo has agreed to acquire AI news startup Artifact, the two companies confirmed on Tuesday. Terms of the deal were not disclosed and the companies confirmed to The Verge that they only acquired Artifact’s underlying technology. All of Artifact’s employees have already moved on.

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Artifact was an innovative news startup from Instagram co-founders Mike Krieger and Kevin Systrom. Using AI, the app was designed to deliver curated content and categories based on an individual’s news-reading habits. While the app earned some traction, it ultimately failed to reach the scale envisioned by Krieger and Systrom, causing the co-founders to shutter the business in January.

“We have concluded that the market opportunity isn’t big enough to warrant continued investment in this way,” they wrote in a Medium post at the time. The decision was met with unhappiness by a range of Artifact users who had come to rely on the app’s AI smarts to deliver the stories they cared most about. 

However, according to The Verge, which spoke to the co-founders in the wake of Yahoo’s acquisition, their decision to shutter the business prompted a host of conversations with potential suitors interested in acquiring the company. Yahoo ultimately proved to be the best option.

Yahoo plans to integrate Artifact’s recommendation engine into Yahoo News. The company told The Verge that Yahoo News now attracts a whopping 185 million readers per month and will use Artifact to recommend stories and other content based on what the reader is engaging with. 

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Yahoo also confirmed that it will not offer Artifact as a standalone app, so users who want the Artifact experience will need to head over to Yahoo News to get it. 

Still, there are some questions surrounding the Yahoo acquisition. The company said it will take some time to add the Artifact algorithm to Yahoo News, so it’s unknown exactly when it’ll be available. And since it will be running in the background, it’s hard to know whether Yahoo will make any changes to the algorithm to make it work with Yahoo News.

Whatever the case, it’s a welcome second act for a once-promising startup and — if implemented well — could pave the way for a serious lift in Yahoo News’ content recommendation engine.