True Convergence: Taking Speech To TV (NUAN, AAPL, MSFT, CMCSA, TWC, T, DTV, DISH)

Nuance Communications, Inc. (NASDAQ: NUAN) is getting a much less of a reception than you might expect following on news that it is taking its Dragon speech recognition to the television.  Most of the people at the Consumer Electronics Show might be hard-wired into their PCs (or Macs) for all forms of media, but what about their parents and their older relatives and friends?

Nuance has been thought of as a potential takeover name for Microsoft Corporation (NASDAQ: MSFT) and for Apple Inc. (NASDAQ: AAPL) on and off for some time.  This may not change the speculation status much.  But what this does accomplish is a new platform to “easily find content by speaking channel numbers, station names, show and movie names.”  This would allow for searching by content, actor, and genre.  The notion that this allows for staying connected through Twitter, Facebook and Skype may just be gravy.

Dragon TV was unveiled as a voice and natural language understanding platform for TV, device and set-top box OEMs and service operators geared toward making it easy to find and access the TV show that a subscriber wants to watch.

If Nuance can open this up to cable outfits Comcast Corporation (NASDAQ: CMCSA) and Time Warner Cable Inc. (NYSE: TWC), and to AT&T INc. (NYSE: T) for its uVerse, let alone DIRECTV, Inc. (NASDAQ: DTV) and Dish Network Corporation (NASDAQ: DISH) for satellite, then Nuance may get a much wider footprint.

How this gets monetized is up for anyone’s guess.  Nuance projected that about 1.6 billion TVs should be connected to the web by 2014 according to Strategy Analytics.  It even notes the difficulty in finding what is on television.  How many times have you been looking for a televised game or show and have no idea what channel it is on?

This will allow OEMs and service operators to deliver TVs, set-top boxes and applications that let consumers find and experience content with Nuance’s leading voice technologies.

Again, the trick is on the monetization.  If it can get a piece of a upcharge for the service then this may open up millions and millions more in revenues per month.  If it is a promotional feature, then this may just be a another brand building effort.

JON C. OGG