YORKTOWN HEIGHTS, NY - It's man vs. machine – for real.

IBM's celebrated supercomputer Watson will square off against Jeopardy champions Ken Jennings and Brad Rutter in a first-of-its-kind competition to be aired over three nights in February.

The grand prize is $1 million; second place wins $300,000; third place receives $200,000. Jennings and Rutter have pledged 50 percent of their winnings to charity; IBM will donate all of its prize.

During a demonstration round Thursday, Watson handily defeated the two Jeopardy champions.

The IBM Jeopardy Challenge represents a milestone in the development of artificial intelligence, and is part of Big Blue's centennial celebration.

"We are at a very special moment in time," said Dr. John E. Kelly III, IBM Senior Vice President and Director of IBM Research. "We are at a moment where computers and computer technology now have approached humans. We have created a computer system that has the ability to understand natural human language, which is a very difficult thing for computers to do."

Named after IBM founder Thomas J. Watson, the supercomputer is one of the most advanced systems on Earth and was programmed by 25 IBM scientists over the last four years. Researchers scanned some 200 million pages of content – or the equivalent of about one million books – into the system, including books, movie scripts and entire encyclopedias.

Watson is not your run-of-the-mill computer. The system is powered by 10 racks of IBM POWER 750 servers running Linux, and uses 15 terabytes of RAM, 2,880 processor cores and can operate at 80 teraflops.

That's 80 trillion operations per second.

Watson scans the 2 million pages of content in its "brain" in less than three seconds. The system is not connected to the internet, but totally self-contained.

The machine is the size of 10 refrigerators.

Watson. Photo by Sam Gustin/Wired.com Sam Gustin/WIRED

"This is the culmination of four years of hard work and we didn't know that we'd get here," said David A. Ferrucci, the principal investigator for IBM's Watson project.

Watson follows Deep Blue, the IBM supercomputer that ultimately defeated chess grandmaster Garry Kasparov in 1997.

Kelly said the lessons IBM learned from developing Watson would be applicable across industries, including law, business, and especially medicine.

"Watson can read all of the health-care texts in the world in seconds," Kelly said. "And that's our first priority, creating a Dr. Watson, if you will."

"Imagine if a doctor in Africa could access all of the world's medical texts from the cloud, in seconds, to learn about potential drug interactions," he added.

During a press conference Thursday morning at IBM Research headquarters in Yorktown Heights, New York, the company showcased Watson and held a practice Jeopardy round between the supercomputer, Jennings, who won over $2.5 million on a 74-game run in 2004-2005, and Rutter, the all-time money leader at $3,255,102.

The scene was slightly surreal. Watson "stood" in between the two champions, its "avatar" – which the company describes as "a global map projection with a halo of 'thought rays'" – flickering and flashing, as if it was thinking.

"The threads and thought rays that make up Watson's avatar change color and speed depending on what happens during the game," according to Watson's official "bio." "For example, when Watson feels confident in an answer the rays on the avatar turn green; they turn orange when Watson gets the answer wrong. Viewers will see the avatar speed up and activate when Watson's algorithms are working hard to answer a clue."

Watson jumped out to an early lead. For the first four questions of the round, the supercomputer "read" the clue, "pressed" its buzzer, and provided the correct answer. Its human opponents tried valiantly to catch up, but the end of the round, Watson was in first place with $4,400. Jennings was second, with $3,400. Rutter was third, with $1,200.

None of the three contestants appeared rattled. Of course, Watson lacks the capacity to get rattled.

"Watson doesn't have any emotions, but it knows that humans do," Ferrucci said.

Asked if he was nervous to be competing against a computer, Rutter quipped, "Not nervous, but I will be when Watson's progeny comes back from the future to kill me."

Thursday's round was just a demonstration. Watson will go head-to-head with Jennings and Rutter in two matches, to be aired February 14, 15, and 16.

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Photos: Sam Gustin/Wired.com

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