Free users become losers as AI startup with AWS bills to pay pursues viral opportunity

Speech recognition purveyor Otter.ai makes a choice to chase Zoom-ing dollars

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Money falling from the sky

Speech recognition purveyor Otter.ai has added the ability to offer realtime transcription of Zoom meetings, at the expense of some elements out of its free plan.

Otter makes a very well-regarded realtime speech-to-text app that works well even on low-end smartphones and can handle multiple speakers reasonably well. The companion website lets users search transcriptions with a click anywhere in transcribed text immediately playing the relevant piece of original audio. The app offered a familiar freemium model that saw users offered ten hours of transcription a month, whether the files were captured on a device running the Otter app or uploaded.

Or it did until last week when free tier users received an email that said “Given a spike in demand for our service with the launch of Live Video Meeting Notes , we need to prioritize resources to accommodate bandwidth.” That’s meant audio file uploads are now restricted to three a month, with a maximum length of 40 minutes per file. Other transcriptions have also been limited to 40 minutes at a time.

Founder and CEO Sam Liang did not explain the nature of the bandwidth crunch but told The Register that the company is an AWS customer and pointed out that clouds don’t come for free.

At a time when videoconferencing is so very hot, the company decided that its new Zoom transcription service deserved priority.

The new Zoom-to-Text service also represents a revenue opportunity that free users do not – it requires paid accounts for both Zoom and Otter. Liang thinks Zoomers are ready to pay, because while videoconferences have quickly become ubiquitous we're not yet good at remembering what goes on in one. Especially on days of back-to-back-to-back online engagements.

Free tier users have been offered one month of premium service, gratis. Which is generous, but not as generous as the original offer.

Of course investors are not interested in generosity, especially in this manic economic moment. Otter’s had $23m pumped into it since 2016, and has pumped out 750 million minutes of transcriptions since going live.

The company has also experienced 5x usage spike in the last month. Who can blame them for trying to cash in? ®

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