DFI International Asks, 'The Voice Portal Revolution: Lip Service or Something to Scream About?'.

Business Editors/Hi-Tech Writers

WASHINGTON--(BUSINESS WIRE)--Aug. 4, 2000

Telephones will be the wave of the future?

It sounds like a prediction from the turn of the 20th Century, but in fact, companies across several industries are hoping to make telephones the key to future Internet access. There are currently more than 1 billion telephones worldwide, 10 times the number of computers.

The relative ubiquity and familiarity of fixed line phones combined with explosive growth in mobile phone usage has encouraged leading telecoms and software companies to combine the telephone with voice recognition technology to make web access truly worldwide.

Voice portals, internet sites with voice-enabled content delivery, may provide the means to bridge the digital divide. Although US internet penetration has surged to nearly 50%, it still pales in comparison to 96% phone penetration. Additionally, the efficiency and safety of hands-free "surfing" will fuel voice portal popularity among mobile users.

And with more than 100 million mobile phone users in the US by 2002 according to Cahners-Instat, companies have significant incentive to find a means to corner this market.

Voice recognition software, which enables computers to understand and carry out spoken commands, is the technology driving the transition to Internet access by phone. Though the technology has been around for years, new advances have improved the abilities to recognize and interpret conversational and multi-user speech patterns.

Fledgling VR software companies such as Nuance and SpeechWorks have enjoyed the riches of the Street so far this year, with shares rising 700% and 300% respectively. Old school players, however, such as IBM and Microsoft, are anxiously watching and positioning on the sidelines, waiting for the green light.

Additionally, companies such as Quack, Tellme, and BeVocal have made significant noise in the voice portal market. Though all three are currently offering similar content services, each has a unique business plan for conquering the embryonic industry. It remains to be seen whether this young guard will stand on their own or be gobbled up by portal behemoths such as AOL and Yahoo.

Regardless, voice recognition is certainly giving Internet revolutionaries something to talk about.

This report is one of a new series providing cutting edge analysis of new technologies, players, and market trends to investors and product developers. For a complimentary copy of the full report please visit www.swannstreetventures.com, or contact Tim Garnett or Julie Fogarty @ 202/785-9041.

About DFI International and SwannStreet Ventures

Founded in 1984, DFI International provides high-tech start up services including management consulting, value proposition analysis, business plan development and evaluation, competitive assessments, market research, and assistance in securing pre-seed and early stage capital.

Areas of expertise include telecommunications, convergence technologies, aerospace, defense industries and other high technology industries.

SwannStreet Ventures, LLC provides pre-seed and seed level capital, as well as consulting services to entrepreneurs and high-tech start ups.