Apple could be preparing to enhance the iPhone's image search and video calling capabilities, or even add face authentication to the iPhone, say analysts and software usability experts.

The iPhone manufacturer is buying Swedish face recognition software company Polar Rose, and if the deal hasn't already closed then it is about to, according to a report by Computer Sweden.

Polar Rose CEO Carl Silbersky declined to comment on the deal, while Apple would neither confirm nor deny the acquisition. Apple "buys smaller technology companies from time to time, and we generally do not comment on our purpose or plans," a company representative said via e-mail.

Analyst Ben Wood sees the move as a logical one for Apple.

"The acquisition reflects Apple's ambition to turn the mobile phone into the hub of your life, and this will give that another dimension," said Wood, director of research at CCS Insight.

Polar Rose has a number of software building blocks that Apple could use for face recognition. FaceCloud is server-based platform that can add face recognition to virtually any service that stores images, and FaceLib allows the technology to be integrated on the iPhone. Until recently the company offered a free face-tagging service that, for example, can tag Facebook friends in Flickr photos.

The most obvious way for Apple to use Polar Rose's technology is for automatically sorting images, according to Christian Lindholm, user interface expert and managing partner at design consultant Fjord. Today, users store a large number of images in a number of different places, on the Web, phone and PC, and automating the sorting of those images would be a good thing for users, he said.

Apple might also use Polar Rose's technology to improve the face recognition function of its iPhoto photo management and editing software for the Mac.

However, the increasing processing power combined with cameras on both the front and the iPhone 4 opens up for using the face recognition technology in other ways. Apple could, for example, do face recognition in real-time on its smartphone. When someone calls you using Apple's video calling software FaceTime, the face recognition software could identify the caller and link to more information about the person, according to Wood.

Polar Rose has already worked with Swedish mobile software and design company TAT on Recognizr, a concept application that recognizes people through the mobile phone's camera in real-time and superimposes links to their profiles on sites such as Facebook, LinkedIn, YouTube and Skype, according to a demo.

For this to be socially acceptable, the person being identified would first have to give their permission, according to Lindholm, who recently saw an application that used image recognition to unlock a mobile phone. Wood agrees: "Privacy will be the big challenge if Apple wants to use the technology in this way," he said.

In general, both cameras on mobile phones are underused, and in the future we will see lots more applications that take advantage of them, according to Ola Larsén, vice president of marketing at TAT.

Another way to use the forward facing camera is authentication, the is camera used to recognizes the user and the unlock the phone, Wood said.

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