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Apple Siri vs Android Voice Actions/Google Now vs Samsung S Voice.

August 2, 2013

  • Kudos to Apple for kicking it off with Siri, but shame on Apple for so quickly allowing its competitors to get ahead.
  • Kudos to Android for the speech technology devt. It’s really great, but Android – get a clue and hire some marketing people: Apple and Samsung have kicked your butt in branding the speech technology.  I still don’t know what to call it!
  • Kudos to Samsung for being first to have an always listening feature that worked!! You can’t stop there… Moto is beating you to the punch in a low power version and in the simple “trigger to search” flow with voice.

What about Microsoft and Amazon? Both have good cloud based recognition engines in house but neither seem particularly relevant in Mobile…YET!

Kudos to Microsoft for its always listening feature in XBox! It’s actually the best implementation I’ve seen that doesn’t use Sensory technology. I’ll blog more about how they do it and why they can’t do a low power implementation in the weeks ahead.

The Value of Speech Patents (part 2)

August 17, 2011

I’ll continue on with a few thoughts from yesterday’s blog because I got asked the question: “Why would speech patents be worth so much more than general telecom and other patents?”

There are 2 key reasons:

  1. Speech is HUGE in mobile.
    1. Look at Google/Android. I read in the Mercury News this week that Google believes 80% of its revenues will come from mobile phone search in the future. Let’s combine that with the old stat that 25% of Android search is voice search (this was a year or so ago, and it’s probably been growing). This would mean a minimum of 15% of Google’s overall revenues will come from mobile phone voice search…and this number will probably grow!
    2. Apple. I guess its common knowledge that their new iOS5 will include “Assistant” that allows a complete voice controlled user experience. This is big. This is the company that defines user experiences, moving from a follower in speech technology to a leader (even if it is Nuance tech!).
  2. Available speech patents are DECREASING. Remember when the Bass brothers started buying up silver to drive up the price? Scarcity increases price. Nuance has been “buying” speech patents at a faster rate than they are issued! Combine this with patent acquisitions by companies like Vlingo, (who spent in the 7 figures to buy up a large number of Intellectual Ventures speech patents in order to countersue Nuance,) and the available portfolio of speech patents is quite small. Finding patents with early priority dates are even scarcer.

As an interesting case in point, Sensory has a few key patents on client/server speech recognition approaches. We have a very early initial filing date from 1996 (if you want to know the patent number, drop me an email.) We went through 10 years of revisions and responses to the patent office and finally got 3 patents issued on our initial concepts of using client devices connected to more powerful servers with speech recognition (yeah that should sound familiar today, but it was a very unique idea in 1996!). These are VERY fundamental patents with a VERY early priority date. Back in the downturn of 2008 we talked to a patent auction house that gave a very thorough evaluation of the patents, and they concluded it would be the highest valued auction they had ever seen. They wanted a “reserve” price in the single million dollar digits, but we wanted it in the double million digits, so we never went forward. It just shows the importance of speech patents, and with the recent lawsuits in the mobile and speech community, speech patents have become even more valuable today!

Todd
sensoryblog@sensoryinc.com

Following M&A Monday–It’s About the Patents

August 16, 2011

Two BIG acquisitions happened over the last week. One is big for the smartphone space, and the other is big for the speech industry. I think they both had something to do with technology patents.

Google acquired Motorola. As everyone knows, Google has been wrapped up in a lot of legal feuds over Android. Android is certainly doing well, its competitors want to knock it down, and patent infringement seems to be the preferred means of fighting. Long established companies like Microsoft, RIM and Apple have had a lot of time to build a patent portfolio…on top of that they recently outbid Google on the Nortel patent acquisition. SO… Google has to beef up its patent portfolio quickly to fight back and eventually do what big companies do – agree to cross license and stop paying the law firms! Or maybe Google just wants a boatload of patents so they can be comfortable indemnifying all the Android users.

So at the end of July, Google bought a boatload (well over 1000) of patents from IBM (Nuance bought a bunch of patents from IBM as well focused on speech tech!)

Now Google buys MOTO. Here’s something really interesting. The price paid for Nortel was about $4.5B for 6000 patents (plus patents applied for etc). That’s about $750K/patent. Google underbid and didn’t get in on the deal. Google bought MOTO Mobility for $12.5B for a little over 17,000 patents… Just under $750K/patent! VERY INTERESTING…seems like $750K/patents is the going rate for large patent portfolios!!!!!

Specialized portfolios in speech technology are worth even more!

Nuance acquires Loquendo. I’m sure this wasn’t just for patents…it was taking out one of their only competitors for both SR and TTS, and Nuance got a GREAT price for a company with a lot of excellent technology. I have no idea how many patents Loquendo has…I think 7 in the US and probably a lot more in Europe. Let’s estimate that they had 35 patents total. At $75M, that would be around $2M per patent, which isn’t far off of the per-patent price Nuance paid for SVOX, who had 60-80 patents. The revenue multipliers seem pretty consistent too…SVOX was doing around $25M in sales and was bought for around 6x sales…likewise Loquendo was doing about $12.5M in sales and was bought for ABOUT SIX TIMES SALES. What does Nuance trade at? ABOUT SIX TIMES SALES. So what does that mean? Well you could argue that if Nuance pays less or equal to its revenue multiplier (6xsales) for an acquisition, then the patents essentially come free because the acquired revenues should immediately boost Nuance’s valuation by close to the purchase price.

I wonder if that’s how Nuance thinks about it. Then they wouldn’t be paying $2M for a patent or even $750K…they’d essentially get them for free and in the process build the biggest database of speech patents in the world.

Maybe Nuance’s strategy isn’t really about taking out competitors and buying customers through M&A, but maybe they want to own the majority of patents in the speech tech space. Nuance certainly hasn’t made money in using patents for lawsuits. Dave Grannan, Vlingo’s CEO was recently quoted as saying, ”We are happy to report that with this latest ruling, Nuance’s record remains perfect in patent infringement trials, they haven’t won any.” You go, Dave!

So why would Nuance want so many speech patents if they can’t make money in court? Well I’ve blogged earlier about their use of patent infringement in acquisitions. Maybe they are looking to be bought by a Google, Apple, or Microsoft…that patent portfolio could certainly do a lot in user experience fights. But if cross licensing agreements get worked out between the companies big enough to acquire Nuance, then where does that leave Nuance?

Well…without a lot of competition for sure!

Todd
sensoryblog@sensoryinc.com

There You Go Again!

June 17, 2011

That’s what America’s most charismatic President used to say! I didn’t necessarily agree with Reagan’s politics, but I sure did like his presentation. Nuance’s Paul Ricci is kind of the inverse of that; a lot of people don’t like him, but it’s hard to argue with his politics (although I will later in this blog…)
Nuance does seem to perform remarkably well. They have an amazing patent position, and are quite highly valued by almost any financial metric you can apply, including their market cap (over $6B and near an all-time high), their revenue multiplier (5-6 range), as well as P/E over 2000 (and although fairly meaningless, it does show they are finally profitable using GAAP rather than their modified accounting policies!!!!)

I’ve never met Ricci. I’ve known a lot of people who have worked for him, with him, and against him. Everybody agrees he’s a tough guy, and I think most would also use words like ruthless and smart. A lot of people might even call him an asshole, and whether true or not, I don’t think he cares about that. He’s a competitive strategy gameplay kind of guy, and he’s done pretty well. However, he has a HUGE challenge being up against the likes of Google, Microsoft, and eventually Apple (let alone the smart little guys like Vlingo, Yap, Loquendo, etc.). But I digress…

I started this blog thinking about Nuance’s recent acquisition of SVOX. And I wanted to congratulate Nuance and Ricci for ACQUIRING SVOX WITHOUT SUING THEM. If I look back a ways (and I can look back VERY FAR!), Nuance (or the company formerly known as Lernout and Hauspie and then Scansoft) has at least 4 embedded speech recognition companies wrapped into it over the years. In rough chronological order: Voice Control Systems (VCS was probably the FIRST embedded speech company and the first and only embedded group to go public), Phillips Embedded Speech Division (I think they had acquired VCS for around $50M), Advanced Recognition Technologies, and Voice Signal Technologies. I believe Ricci was at the helm during the Philips embedded acquisition (this was the one closer to 2000 as opposed to the Philips Medical group a few years ago), ART, and VST. Interestingly, 2 of these 3 were lawsuit acquisitions. There are probably some inside stories about SVOX that I don’t know (e.g. threats of lawsuits??), but it appears that Nuance’s acquisitions of embedded companies are now down to 50% lawsuit driven. Thanks, Paul, you’re moving in the right direction! ;-)

OK, so what’s wrong with suing the companies you want to acquire? It probably does lower their price and reduce competitive bidding. Setting aside the legal and moral issues, there is one huge issue that’s clear- If you want to hold onto your star employees and technologists, you need to treat them well. Everyone understands who the “stars” are – they are the 10% of the workforce that contribute to 90% of the innovation. They are not going to stick around unless they are treated right, and starting off a relationship by calling them thieves is not a good way to court a long term relationship.

For example, there’s been a lot of press lately about the Vlingo/Nuance situation and how Ricci offered the top 3 employee/founders $5M each to sell Vlingo (plus a bundle of money for Vlingo!) Well, Mike Phillips used to be Nuance’s CTO (through acquisition of Speechworks)…so wouldn’t it have been more valuable to KEEP Mike there than BUY him back? The “other” Mike…Mike Cohen is Google’s head of speech. He FOUNDED Nuance (well, the company formerly known as Nuance!) and left to join Google, and of course this caused a lawsuit…think either of the Mike’s (two of the smartest speech technologists in the industry) would ever go back to Nuance? Google has managed to hold onto Cohen, so it’s not just an issue of the best people leaving big companies because “little companies innovate.” I’ve also seen the recent rumor mill about Nuance’s Head of Smart Phone Architecture leaving for Apple…
By the way, you gotta treat customers nicely too! Strong arm tactics on customers and competitors might close short term deals, but I think there are better approaches in the long run.

So it’s the personnel and customer thing that Nuance is missing out on in their competitive gameplay strategy, and my hope is that SVOX’s acquisition represents a significant change in how Nuance does business!

As a point in contrast, Sensory has acquired only one company in our history – Fluent Speech Technologies (and no, we didn’t sue them first.) This was a group that spun out of the former Oregon Graduate Institute back in the 1990’s. We saw a demo of theirs back in 1997-1998, and thought the technology was great. They offered to sell us the speech recognition technology (not the company), so they could focus on animation opportunities, but we had NO INTEREST in that. We wanted the people that made the technology, not the technology itself. That’s how our Oregon office was born; we acquired the company with the people. The office is now about as big as our headquarters (and some of our people in Silicon Valley have even moved up there!) By the way, ALL the technologists that came with that acquisition are still with us after 12 years, and we’ve kept a very friendly relationship with the former OGI as well.

Time for a breather…Yeah, I do long blogs….if you see a short one, which might start appearing, it’s probably a “ghostwriter” helping me out…. ;-)

So let’s look at Nuance’s acquisition of SVOX. Why did Nuance acquire them?

  1. SVOX was for sale. I don’t mean this tongue in cheek. I suspect SVOX proactively approached Nuance (and probably Google and others as well) to buy them. If you look at SVOX’s Board (many of whom are their investors), it’s a bunch of guys that ran retail empires and huge organizations, so they probably got tired (in the midst of the economic downturn of the last few years) of waiting.
  2. SVOX was affordable. I don’t mean cheap, and I don’t know yet what Nuance paid, but my guess is Nuance probably paid in the 4-7x sales range. SVOX as a wildass guess was doing in the $20-$30M year range, so Nuance might have paid $80-$210M…quite affordable for Nuance. Since Nuance is traded at around 5-6x sales, that’s not too bad from a revenue multiplier perspective, and I’d guess SVOX has been profitable so the deal should be accretive to Nuance. If the numbers come out and Nuance paid more than $200M (their prior embedded acquisition of VST was about $300M!), that means there was some serious bidding going on – and probably with Google, Microsoft, or Apple (The Big Guys) in the mix, since they all could have used SVOX technology and patents.
  3. SVOX had Patents. SVOX acquired/merged with Siemens’ speech group a few years back, and with this merger came “60 patent families.” That’s a lot of patents, especially when you add on the patents that SVOX got before and after the merger with Siemens. This will continue to fuel Nuance’s tremendous patent position. My opinion is that it was quite a mistake for the Big Guys – especially Apple- to pass up this combination of talent, technology and patents…they could have easily outbid Nuance !
  4. Customer acquisition. OK, this was probably Nuance’s primary motivation, and probably the reason that Nuance would outbid companies wanting SVOX for “in-house” solutions. SVOX had a lot of deals in automotive and mobile handsets! They were very strong in small-to-medium footprint (1-50MB) TTS, and were making fast inroads with their speech recognition. Nuance loves to buy customers. SVOX had customers.
  5. Keeping Apple and Google from Acquiring SVOX. It’s not often that Apple loses, but I think they lost on this one. SVOX would have been a really cheap way for Apple to make a big move into speech with an in-house technology. It’s going to be hard to grow it all internally, but what a nice bootstrap SVOX would have been in patents and technologies! Google is one of SVOX’s customers for TTS (Hey – Nuance was one of the founding members of the Open Handset Alliance that developed Android!), but with Google’s hiring and acquisitions in the speech space, the writing was on the wall for SVOX to go the way of Nuance, and get designed out of Android for Google’s internal solutions. By keeping SVOX away from Apple and Google, Nuance has the opportunity to keep two huge customers (i.e. Google from SVOX and Apple) from jumping ship…but I still think it will happen eventually!
  6. Automotive Industry Contacts. I read the press release about advancing “the proliferation of voice in the automotive market”, and accelerating “the development of new voice capabilities that enable natural, conversational interactions” and about SVOX supplying the Client for Client/Server hybrid solutions. None of that market-speak makes my list. I think the technologies that SVOX had were pretty redundant to what Nuance has. SVOX had better customer relations and accounts in automotive…that was really the driver!

Anyways…I suspect the acquisition was a good deal for Nuance and its investors, and probably a GREAT deal for SVOX and its investors. Nuance’s market price didn’t seem to move much, but maybe it will once the price is disclosed. I commend and encourage Nuance to cut the lawsuits…one of them could bite back a lot worse than the pain of losing employees!

Todd
sensoryblog@sensoryinc.com

Microsoft, Google and Apple…Not a Bad Month for Speech Technologies

June 16, 2011

I’ve been in the speech technology field since the beginning and I have to say, there has never been a more exciting time for this space. Recently some of the biggest names in technology have announced the integration of voice capabilities into their products. At this year’s E3 conference, Microsoft stated that the next version of it’s Xbox Live will include voice commands. Also, it appears Apple will integrate speech-to-text input in the iOS 5. Android 2.1 already has speech-to-text built in to its mobile platform. And just this week, Google announced that voice search capability is coming to the Google.com search box (how cool?!)

All of these developments will be exposing more and more mainstream users to the benefits of the voice user interface on a daily basis. Consumers demand so much from personal devices and if they expect to control them via voice, they’ll want to do so from beginning to end (no button pressing, ever). This is where Sensory comes in. Our Truly Hands-Free technology is better than anything out there and lets manufacturers add a hands-free trigger to the interface so the user can give the device a call to action without ever lifting a finger. No need to take eyes off the road to make a call from a hands-free car kit, no need to dirty up your tablet or computer by using messy (cooking) hands to call up a recipe, no need to disturb your comfortable state of rest to set an alarm clock, etc.

I can say from where I sit, many manufacturers see the value of a voice user interface that includes a hands-free trigger phrase. Expect to see the makers of automotive products, smartphones, home entertainment products and more using Sensory’s technologies in the coming year. And be sure to stay tuned for exciting enhancements and innovations in store for our Truly Hands-Free technology, as well.

Todd
sensoryblog@sensoryinc.com

Google’s Nexus One Isn’t Afraid of Speech!

January 7, 2010

Yeah everyone’s writing about the new Google phone. I’ve heard various reports about it being underwhelming, and in-need of the marketing hype that Apple is so good at. Everybody loves to compare the iPhone with the Nexus One and talk about screen size, weight, camera capabilities, software, etc.

Here’s my 2 cents on speech recognition and Bluetooth for these devices:

Apple’s initial iPhone release had speech recognition–phobia, with no factory options for implementing voice recognition commands. It was such a shocking omission that many of the mainstream reviewers even pointed it out. In various industry conversations I heard “Steve doesn’t like speech recognition”. As a result, 50 speech recognition applications quickly appeared in the Apps store, and by necessity Apple soon implemented Voice Control for music and voice dialing. I assume Apple implemented Nuance technology and most likely in a local version that runs on the iPhone.

What Google’s done with the Nexus is WAY different. They are embracing speech recognition from the start, and not just implementing “me too” features. Google is pushing the boundaries by including speech recognition for dictation (text messaging, email, social networking, etc.) and mapping/GPS type functions. I remember the original Android announcements mentioned that Nuance was their speech partner, but it seems like all the big guys like to start with Nuance then switch away. My guess is that the Nexus One uses homegrown (Mike Cohen and Co.) speech recognition, and since it is server based, it should adapt and improve and just get better with the data they are collecting.  I give Kudo’s to Google for this!

On the Bluetooth side of things, we were shocked and hurt that we couldn’t use our BlueGenie Voice Interface Bluetooth headsets to easily call up recognizers on the iphone for name dialing. Although Bluetooth makes a clear protocol for this, it wasn’t implemented on the initial iPhone. New iPhone versions do support this, but Apple never clearly thought through the importance of a cohesive user interface and functionality with Bluetooth connected to its phones, especially when speech recognition is involved.

If Google is smart, they won’t only introduce a Nexus One phone, but they’ll come out with a really cool Nexus One headset that TAKES ADVANTAGE of all the great speech recognition software on the handset, with one seamless voice user interface! The Nexus One has been blasted as nothing really new, but this type of integration with a hands-free headset or car kit could make it TOTALLY REVOLUTIONARY.

Hey Google – make a BLUEGENIE VOICE INTERFACE HEADSET!

Todd
sensoryblog@sensoryinc.com

“I talk to myself but I don’t listen” – Elvis Costello

November 18, 2009

The new Android OS doesn’t have this problem! I read about one of these devices with TTS (Text-To-Speech) built in and voice commands too, so of course I had to try one out. I put it into TTS mode where it speaks everything, hit the recognition button and it prompted “SPEAK NOW.” I said something like “Starbucks in Sunnyvale, California”…and guess what it recognized??? “SPEAK NOW.” I guess the recognizer started listening too early and heard the TTS itself saying “SPEAK NOW.”

Listening at the right time is always a challenge for speech recognizers, but in Speech Recognition 101, programmers learn to make the recognizer listen AFTER the prompt is spoken. In Speech Recognition 201, students are taught to trim the silence after the end of the speech prompt, otherwise those that studied Speech Reco 101 will have it listening for a recognition word too late (because there’s usually a silent tail on the prompt that users don’t hear, so they speak too early if it’s not trimmed). Therefore, the first few hundred milliseconds of the user’s speech will be clipped off.

That same TTS in the Android was a Verizon product. Guess how it pronounces Verizon? Well, not the way I’ve ever heard it pronounced. TTS isn’t easy, but this should be an easy fix. Someone at Google or Verizon will figure it out soon, and Nuance will probably get a call.

I heard a great NPR report the other day about the Amazon Kindle. The product is being boycotted by groups as diverse as Syracuse University, the National Federation for the Blind, and the Burton Blatt Institute for Disability Studies. The complaint is that the while the Kindle offers Text-To-Speech as an option, it only reads from the books, and does not provide a friendly user interface for the visually impaired. In fact, one spokesperson said that the Text-To-Speech function is just about impossible for a blind person to use. Basically, Amazon needed to offer a mode where the TTS reads any button that was pressed, which shouldn’t have added any real cost to the bottom line. Better yet, they could have added a little speech recognition so the buttons weren’t even necessary!

Todd
sensoryblog@sensoryinc.com