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Considering its work with Cortana, Microsoft's acquisition of Semantic Machines makes perfect sense.

Announced Sunday, the purchase is designed to bolster not just Microsoft digital voice assistant Cortana but also social chatbots like XiaoIce, which has had up to 30 billion conversations across China, Japan, the United States, India and Indonesia.

Berkeley, California-based Semantic Machines describes itself as developing the fundamental technology to allow humans to interact naturally with computers. It's led by tech entrepreneur Dan Roth, UC-Berkeley Professor Dan Klein and Stanford University Professor Percy Liang.

"With the acquisition of Semantic Machines, we will establish a conversational AI center of excellence in Berkeley to push forward the boundaries of what is possible in language interfaces," said David Ku, chief technology officer of Microsoft AI & Research. "Combining Semantic Machines' technology with Microsoft's own AI advances, we aim to deliver powerful, natural and more productive user experiences that will take conversational computing to a new level."

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