Nuance Buys Vlingo, as Google, Apple's Voice Search War Simmers

Nuance Communications (NASDAQ:NUAN) agreed to acquire Vlingo, a move that buries a legal hatchet between the two rivals and makes things more interesting in the battle between Google (NASDAQ:GOOG) and Apple (NASDAQ:AAPL) for the best speech-recognition capabilities.

Nuance said it struck the deal, for which financial terms were not disclosed, to help meet the demand for intelligent voice interfaces that combine voice, language understanding and semantic processing. The buy also brings closure to the patent-infringement lawsuit between Nuance and Vlingo.

Nuance will tuck in Vlingo's technology and Nuance research and development chops to build better natural-language interfaces, which the companies believe represents a $5 billion market opportunity across phones, tablets, TVs, cars and other consumer electronics.

"Inspired by the introduction of services, such as Apple's Siri and our own Dragon Go!, virtually every mobile and consumer electronics company on the planet is looking for ways to integrate natural, conversational voice interactions into their mobile products, applications and services," Mike Thompson, senior vice president and general manager for Nuance Mobile, said in a statement.

This may not be the normal hyperbole company executives utter when they want to justify acquisitions.

Apple's Siri, launched on the iPhone 4S in October, has certainly generated a raft of interest beyond anything Google has triggered with its own speech-recognition applications for Android smartphones and tablets.

Nuance's speech-recognition software currently powers Siri, which replaced Vlingo in a coup that occurred before Apple acquired Siri in 2010.

Vlingo enables Android smartphone users to speak preset commands into their handsets to perform Web searches, make phone calls, send text messages and perform other tasks.

Vlingo became a lot more Siri-like in July 2010, with the addition of a SuperDialer feature that calls out to the Web like Siri does. As with Siri, users may access the SuperDialer by voice to look for local taxis or pizza restaurants, then call the businesses with one click.

At that time, Vlingo appeared to be a fine acquisition target for Google, which had only Voice Search software at the time. Instead, Google one month later introduced Voice Actions, offsetting Vlingo on some Android handsets.

Word in the blogosphere is that Google is developing "Majel," an upgrade to Voice Actions that uses natural-language processing to make it more like Siri.