Voice Recognition Industry Poised for Revolution

If the predictions are correct, more people are going to be talking. Datamonitor is forecasting the voice business market to return to positive growth during the second half of 2002 and grow quickly through 2007 where the whole market (including platforms, enabling software, applications, and services) will be worth $4.33 billion.

Datamonitor estimates that one-quarter of the Fortune 500 invested in voice business in 2001, up from 12 percent in 2000, giving evidence to the perceived return on investment (ROI) of this industry. “Vendors have been forced to apply their technologies towards solving actual business needs, said Benjamin Farmer, Datamonitor voice business analyst. “As a result, many vendors have been able to demonstrate ROI to enterprises and service providers through voice solutions.”

Datamonitor’s analysis revealed that the largest current market for vendors is call center automation, which represents 44 percent of supply-side revenues. In addition, communications and transactions applications have great growth potential. Beginning in 2004, sustained above-average growth, fueled by advanced speech technologies, will increase the percentage of annual supply-side revenues garnered by these categories by five percentage points each over the next five years.

In-Stat/MDR is in agreement with Datamonitor’s findings as they report that the U.S. speech recognition market continued to grow in 2001, despite an economic climate that was particularly damaging to new technologies and the bankruptcy of Lernout and Hauspie, one of the leading providers.

In-Stat/MDR believes that speech recognition adoption will become increasingly mainstream as a number of contributing factors emerge, such as advancements in VoiceXML [define], faster processor speeds, and Speech Application Language Tags (SALT) standards. In addition to refining the speech recognition engine itself, there have been significant advances in development tools, which will both speed production and lower costs.

Further attributing to the adoption of speech recognition applications is the increasing importance of customer relationship management (CRM) strategies. Speech recognition will help reduce churn and customer attrition with customized features, such as voice dialing. This will be particularly valuable to the growing wireless industry as carriers look to add worthy services to subscribers. Legislation restricting the operation of mobile handsets without hands-free units will also contribute to the speech revolution.