Apple is to acquire Swedish face recognition software firm Polar Rose for an undisclosed amount.
The Polar Rose software is designed to work in the cloud, on computers, iPhones and Android smartphones, according to US reports.
The Swedish firm has developed technology that uses complex algorithms to identify photos, so they can be linked to other information.
This means the technology could be used on social networking sites to identify and tag people in group photographs.
Analysts said Apple may be planning to expand Polar Rose's technology on the iPhone to compete with Google's image recognition software for smartphones.
Google Goggles for Android enables web searches using photos taken with a mobile phone of things like logos, books, and landmarks.