• March 16, 2007
  • By Colin Beasty, (former) Associate Editor, CRM Magazine

Tellme About Microsoft's Acquisition

Microsoft plans to purchase Tellme Networks in an effort to bolster its voice services portfolio and add speech recognition to a broad range of its software and online services, the company announced Wednesday. Terms of the deal were not disclosed, but it has been rumored to be worth about $800 million. In addition to mobile search technology, which has been Tellme's specialty since it was founded in 1999, the acquisition also brings to Microsoft expanded capabilities in the areas of hosted customer service, voice user interfaces, IVR systems, and software-as-a-service. Microsoft intends to integrate Tellme's technology into the unified communications platform that it expects to release this summer, and will challenge its developers and industry partners to build new speech products and services on top of Tellme's scalable, open standards-based platform, according to Microsoft. The company said that some new products that could potentially result from the deal are voice-enabled customer service software and the addition of speech recognition to its Windows Live Search engine to provide a mobile search platform. Jeff Raikes, president of the Microsoft Business Division, says the addition of Tellme will help strengthen Microsoft's speech recognition prowess, an area where it "has only scratched the surface of what is possible." Microsoft has already built voice capabilities into its recently released Vista operating system, Office 2007 suite, and Microsoft Mobile. "The acquisition of Tellme will bolster Microsoft's existing speech capabilities, bringing immediate-term value to our customers and partners," he adds. "Speech is universal, simple, and holds incredible promise as a key interface for computing," said Microsoft CEO Steve Ballmer in a written statement. Microsoft has long promoted its own speech-recognition products and endeavors to add voice enablement to its Windows OS. The company recently added speech-recognition technology to Exchange Server 2007 and plans to integrate Speech Server with an update to its Live Communications Server unified communications software, which is due out soon. These efforts and the addition of Tellme to its portfolio could bode well for its speech strategy in the future. "I think there is an interesting overlap between the hosted Tellme platform and the Microsoft Speech Server and the work Microsoft has been doing in the unified communications group," says Mike Gotta, an analyst with the Burton Group. However, Gotta said that any integration of the hosted Tellme platform and the on-premise speech technology from Microsoft will require a package of interfaces and APIs so developers can build applications that work across the technology. Gotta also said Tellme might be able to provide some insight into scalability, "a feature that Speech Server has been lacking." Related articles: Microsoft Goes Vertical
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