In 2009, Nuance Communications, one of the largest players in voice recognition software, licensed its technology for use in a small mobile app. That app was Siri, which Apple bought in 2010 and turned into a major feature in the latest iPhone, allowing users to speak all types of questions and get answers from a virtual personal assistant. Although the terms of Apple’s arrangement aren’t public and neither side will share details, it was clearly a big win for Burlington (Mass.)-based Nuance, which now powers voice recognition on millions of devices.
That success has given Nuance, which also sells its voice recognition software to health-care and financial companies and is known for being a hard bargainer, a new respect for the value of freebies. In September, Nuance started offering free tools to mobile developers for building applications using Nuance’s speech recognition software. That’s triggered a wave of new apps where users can shop, search, play games, or otherwise use their phones through voice alone. “It’s a way to seed the market with our technology,” says Matt Revis, a vice president at Nuance Mobile, which makes money when appmakers upgrade to plans that offer customer service or more features. Siri is an example of “the types of situations we are looking to develop: smaller companies using us becoming big.”