ScanSoft stages three acquisitions

Speech recognition vendor ScanSoft this week announced plans to pay up to US$98 million to buy three vendors in an effort to strengthen its product portfolio in three key areas: directory assistance, wireless applications and enterprise speech applications.

ScanSoft has signed separate agreements to acquire Phonetic Systems, ART Advanced Recognition Technologies, and Rhetorical Systems.

The largest of the three deals is for Phonetic Systems, which makes speech recognition applications that provide voice-based access to information, applications and services. Its tools automate functions such as carrier directory assistance, password management and corporate call routing. ScanSoft will pay US$35 million in cash for Phonetic Systems, plus up to US$35 million more in performance-based considerations over the next three years.

Meanwhile, ScanSoft will pay US$21.5 million for ART, which makes embedded speech and handwriting recognition software for mobile devices; and US$6.7 million for Rhetorical Systems, which makes text-to-speech software.

ScanSoft and its SpeechWorks division already offer a wide range of speech-related technologies for call center automation, directory assistance, identity control, call forwarding, broadcast messaging, voice-activated dialing, automated attendant and multimodal messaging.

As more and more companies deploy automated systems to help users retrieve the information the need, speech applications, in turn, need to be more dynamic, sound more natural and allow more conversational interactions, ScanSoft says. The three acquisitions will help ScanSoft improve the quality of its speech applications, the vendor says.

The addition of Phonetic Systems' technologies is aimed at strengthening ScanSoft's portfolio of automated directory assistance and operator services applications. Key customers Phonetic Systems brings to the deal include AT&T, JP Morgan, Motorola and The Procter & Gamble.

ART brings embedded speech prowess to ScanSoft. Its speech interfaces for wireless mobile devices let users speak commands to set meetings, call people, read e-mail and retrieve information from corporate systems or the Internet, for example. Wireless vendors that have adopted ART's technologies include Analog Devices, Agere Systems, Hitachi, LG Electronics, Intel, Mitsubishi Electric, Motorola, NEC, Panasonic (Matsushita Electric Industrial), Qualcomm and Texas Instruments.

With the acquisition of Rhetorical Systems, ScanSoft bolsters its existing speech synthesis technologies. Adding new techniques, tools and services from Rhetorical Systems will enhance its ability to deliver custom, dynamic voices, ScanSoft says.

ScanSoft expects to close the Rhetorical transaction in December and the other two deals in January.

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