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L&H pins voice tech to Asian growth

Cantonese and Mandarin mobiles on their mind

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Lernout & Hauspie's campus in Belgium is close to Ieper (Ypres), the site of the most extraordinary carnage during the First World War. The layout of the Flanders Language campus is modelled on the inside of the human ear, with buildings at the site spiralling off a model of the inside of the human ear. Its own HQ is at the centre of the spiral, but other firms which have offices there include Intel, Microsoft, Cisco and a number of smaller startup firms, all focusing on the aural and oral Holy Grail.

Last Friday, over 120 journalists from across Europe were treated to a day-long seminar on voice recognition technology, with demonstrations of the technology L&H believes has a big future, particularly in the Far East.

L&H projects massive Internet adoption in mainland China during the course of the next three to four years.The English language will no-longer dominate the Web. That, claimed one senior executive at the company, is a myth anway, fostered by a US-centric and Euro-centric view of the world.

According to Louis Woo, general manager of L&H Asia Pacific, there are "more dialects in India than the number of countries in the United Nations". There are also multiple Chinese dialects, while the main languages - Cantonese and Mandarin - have a tonal nature which offer considerable challenges. Cantonese, he said, is a double byte language with nine tones, while Mandarin is slightly less complex, being a double byte language with four tones.

IDC, Dataquest and research from other firms including Ericcson, show that in the US there is one mobile phone for every four PCs. In China, the figure is six mobile phones for every PC, with an estimated 60 million of the population already using mobiles. China is also Ericcson's biggest market worldwide.

As far as usage of the Internet is concerned, by the end of 2004, in the Asia Pacific region - which excludes Japan - there will be 95.2 million Internet users. This year, there will be 150 million PC users and 450 mobile users worldwide. By 2004, there will be a total of one billion mobile users. Six hundred million will access the Internet using their mobile appliances that year.

Woo demonstrated Cantonese voice recognition software, which demonstrated that L&H has gone some considerable way towards the goal of recognising the nine different tones, and transferring that into Chinese characters. With such a large market, Woo's thesis that many will use voice recognition is somewhat compelling. Using small form factor mobile phones, as he pointed out, is not entirely suitable for comfortably handling the Internet.

While L&H is also working on machine translation software for Cantonese and Mandarin, it is likely to be over a year until we see the first working software. The firm already has machine translation from English to Japanese, and Japanese to English.

But will Lernout & Hauspie be the company which mainly benefits from the Asian boom in speech recognition? Jo Lernout, co-founder of the company, in an interview with The Register, was frank about the challenges facing his firm.

While IBM, Microsoft and Philips compete in speech recognition software, he said, Big Blue is unable to divert enough resources to exploit what it understands is a lucrative and important market. Microsoft, too, has other diversions which prevent it from putting the R&D necessary to take advantage of this growing market. Both Microsoft and Intel have invested in L&H, the former to the tune of around six per cent. Intel invested $30 million, around 1.5 per cent of L&H, last year, and occupies a building in the Flanders campus. It is developing so-called "intelligent agents", in cooperation with L&H, to aid its e-commerce push.

But L&H itself is not without its own challenges. It recently acquired Dictaphone, a major player in the US health market, and also took over US player Dragon Systems. The combined revenues of all three firms amount to some $700 million, and is likely to propel L&H to over a billion dollars in revenues next year. What keeps Lernout awake at night, he said, is that L&H has to keep expanding the staff bandwidth to keep up with the demand. "If we double the revenues, we more than double the profits," he said. The Dragon acquisition gave L&H access to over 200 additional engineers, while Dictaphone had a large medical database priceless in terms of R&D.

It is clear from conversations with executives that the firm is nailing its colours more to the mobile and convergence mast, in Asia at least, than to the PC market. And if it succeeds in beating IBM, Philips and Microsoft to that market, the revenues are bound to pile in. ®

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