Report: Microsoft Might Buy Tellme Networks

Internet news site CNET.com, citing unnamed sources, reported Monday that Microsoft is in discussions to purchase privately owned voice-recognition software company Tellme Networks. The Wall Street Journal claims the deal could be worth up to $800 million. Microsoft calls the story "rumor and speculation;" neither company is offering any further comment. Microsoft business group president Jeff Raikes said last week that the company expects over 100 million people to use its Office software to make phone calls over the Internet using voice-over Internet protocol [VoIP] by 2010 and is adding VoIP capability to some of its latest software, including Office Communications Server 2007. Microsoft also wants to enable users to use voice commands with products like its Outlook email program. Tellme could provide Microsoft with wireless search capability -- considered by Microsoft to be a largely untapped market -- by folding voice recognition capability into Microsoft's Windows Mobile OS for cell phones. Tellme provides automated, voice-based phone services to clients FedEx, Merrill Lynch, Cingular and AT&T.

Sources: CNETnews.com, Reuters, Wall Street Journal, Information Week
Commentary: Microsoft Vista's Voice-Recognition Software: The Future of PC Applications • Speech Recognition Software: Nuance Communications Has Got The Gist
Stocks/ETFs to watch: Microsoft Inc. (MSFT). Tellme Networks supplier: Nuance Communications Inc. (NUAN). ETFs: SPDR DJ Wilshire Large Cap (ELR), SPDR DJ Global Titans (DGT), iShares Goldman Sachs Technology (IGM)

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