Microsoft announced on Wednesday that it is acquiring TellMe Networks, a company specializing in nationwide directory assistance, enterprise customer service, and voice-enabled mobile search.
TellMe is privately held, and the companies declined to disclose the specific terms of the deal. There are wide-spread reports, however, that the price tag is between $800 million and $1 billion, which would make TellMe Microsoft's largest acquisition since 2002. The companies expect to finalize the transaction by the second quarter of 2007.
At a press conference held (appropriately enough) by telephone, Microsoft Business Division president Jeff Raikes said that the software giant sees speech "as a universal, simple capability to open up the potential of computing."
"The acquisition of TellMe is the right thing for our customers," Raikes added, "because it allows us to extend the speech platform to provide richer services. In addition, it's going to allow Microsoft to build on its goal of software plus services."
From FedEx to Domino's
TellMe, based in Mountain View, California, was founded in 1999 with the goal of providing a wide variety of information to callers, and has since grown to 320 employees
Mike McCue, the cofounder and CEO of TellMe, said that many people use TellMe services without even realizing it. "TellMe currently handles about half of all directory calls in the United States," he said. He pointed out when people call for FedEx package information or order a pizza from Domino's, they're using TellMe technology.
"We've been working for eight years to bring together the vision and technology to allow anyone to say what they want and get it on any telephone in the world," McCue said. "This combination allows us to fulfill our vision and bring it to billions of consumers."
The name "Google" did not come up in Raikes's presentation during the press conference, but it is no secret that Microsoft is eager to find ways to eat into the search giant's market share. The acquisition of TellMe is a clear sign that Microsoft views voice as the next big search battleground.
Both McCue and Raikes predicted that in the near future, consumers will be able to press a button on their Windows Mobile-enabled phones, say a single word -- for instance, "Starbucks" -- and using TellMe technology, the phone will interpret the request and download a map with directions to the nearest location.
"Our goal," Raikes said, "is to put people at the center of communications and improve their productivity." He predicted that Microsoft's purchase of TellMe will eventually allow consumers to use voice commands to obtain information not just on telephones, but also on the full range of devices that use Microsoft software.