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There are good reasons why Apple (AAPL +2.9%) may not make a play for Nuance (NUAN +2.6%): Apple...

There are good reasons why Apple (AAPL +2.9%) may not make a play for Nuance (NUAN +2.6%): Apple doesn't make $8B acquisitions, and Nuance is in areas such as medical transcriptions that Apple doesn't want. But Mike Dawson thinks they'd be crazy not to try, since it could be worth it just to keep the speech recognition technology away from Google (GOOG) and Microsoft (MSFT).
Comments (6)
  • hermanbrut
    , contributor
    Comments (255) | Send Message
     
    Nuance's voice eliminates most everyday needs for keyboarding and even key pressing.
    NUAN makes possible iPhones the size of the new iPod nano (with the fractal antenna inside). Also you can lose your "remote" because you can just talk to your new Apple iTV.
    Apple would be cray not to buy NAUN.
    They have the cash just sitting there and, as a shareholder, I can't think if a better way for Apple to spend it.
    24 Oct 2011, 12:38 PM Reply Like
  • mogando
    , contributor
    Comments (313) | Send Message
     
    speech recognition is nothing unique. it's the context-specific AI in Siri that makes it unique and human-like.

     

    Android voice recognition is still talking to a robot and making a very small set of pre-programmed commands, while Siri is nearly close to talking to a human.
    24 Oct 2011, 12:47 PM Reply Like
  • zd2002
    , contributor
    Comments (153) | Send Message
     
    I see three possibilities how Tim Cook may want to keep this away from Microsoft and Google:
    1. Buy Nuance outright and spin off the businesses Apple doesn't want
    2. Buying only the part of Nuance that make Siri (hard to see how Nuance would want to sell that)
    3. Enter an exclusive contract with Siri, sharing the R&D (or pay the R&D altogether) with right of first refusal for any future licensee.

     

    Apple has enough cash to do any of the options, but #3 is most likely.
    24 Oct 2011, 02:22 PM Reply Like
  • mackmfdee
    , contributor
    Comments (2) | Send Message
     
    Apple owns the Siri artificial intelligence. nUAN enhances voice recognition for dialects and accents.

     

    NUAN recognizes what is said
    Apple's SIRI understands, mostly, what you mean when spoken

     

    Hope that clarifies
    24 Oct 2011, 09:44 PM Reply Like
  • neurocog
    , contributor
    Comments (108) | Send Message
     
    For reasons below, I think that Nuance may get special treatment here, thus increasing the potential of a buyout. Even if Apple doesn't buy them out, the increasing value of the Nuance patent portfolio may give the company a major boost.

     

    First, I am quite confident that this *IS* Nuance, not a parallel technology. The software works in the exact same way as the Dragon app; uploading voice data to the cloud, which then decodes the language and sends back the text or other instructions back to the phone. NO GOOGLE SEARCH REQUIRED, but SERVER DEFINITELY REQUIRED (for at least the next few years, processor-wise) for the very complex voice/semantic analysis. This is the first real threat I have seen from Apple into Google's core search business. Apple can funnel the Siri-based searches through whatever platform they want, Google, Bing, or otherwise. This leverage is very valuable.

     

    I expect Siri will migrate to other Apple devices (e.g., PCs) in the near term. The fact that it is limited to the 4S right now is a pump-fake. They could easily put it in other less powerful devices but this would undercut sales of their new products. However, there probably will never be another new Apple product without this technology. Once people get used to this technology, they will want it everywhere and synchronized.

     

    Double important: The voice data itself is a goldmine. Apple can now pick up on geo-located trends (don't forget the GPS capability of the phone) and use this for any purpose google ever could (sales, market prediction, basic research), and then some.

     

    I won't underestimate Apple's potential ability to find a way to get this technology without buying Nuance, but I think that buying Nuance and paying through the nose for the licensing of the patents are two of the most obvious ways to do this. However they would be silly to have made a huge upfront investment (by their own standards) without seeing how the public reacts to it. I think the verdict on that is in now, with a much better than anticipated response and favorable reviews in all the major publications.

     

    I am long AAPL and NUAN.
    25 Oct 2011, 10:19 AM Reply Like
  • Don McKay
    , contributor
    Comments (79) | Send Message
     
    Microsoft is already deap into speech recognition technology on it's own.
    25 Oct 2011, 02:20 PM Reply Like
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