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iPad with Siri would sound sweet to Nuance

Siri lied to me.

I asked the personal assistant with that efficient female voice on my iPhone whether her services would be available on the new iPad. She told me that everything I needed to know about Apple Inc. products could be found on the company’s website.

Continue reading below

Ha!

Many Apple followers expect the company to use a publicity event Wednesday to unveil the iPad3, a new tablet presumed to include the Siri assistant that responds to spoken questions and commands. But don’t bother looking for confirmation on Apple’s website or from any other official source.

The addition of Siri to a new iPad would certainly be a big deal for Nuance Communications Inc., the Burlington voice recognition company that helped bring the function to life on Apple’s iPhone 4s late last year. Nuance won’t discuss what specific technology it provides to Apple but confirms its software powers Siri’s uncanny ability to recognize human speech.

Siri was a hit right out of the gate, the shiniest new bell and the loudest new whistle on an updated iPhone that sold 37 million units during the last three months of 2011.

Nuance has been in the voice recognition business for a long time, and many people are familiar with its Dragon speech products, including its Dragon Go! applications for smartphones. The company is known for its relationship with Apple but sells its software to many other electronics manufacturers.

Years of internal product development and a long list of corporate acquisitions, including the recent purchase of local rival Vlingo Inc., have made Nuance the clear leader among voice recognition companies.

“Nuance is the umbrella under which voice innovation is happening,’’ says Sarah Rotman Epps, a senior analyst at Forrester Research Inc. in Cambridge.

Recently, that innovation has meant two things to the average customer: Voice recognition works much better than it once did, when a user had to spend hours training the software to hear correctly; secondly, voice instructions are helping all kinds of electronics - smartphones, computers, and even televisions - execute more complex tasks, including many that depend on cloud-based resources reached via the Internet.

“I feel like every year since 1999 was supposed to be the year for speech, but Apple has changed the nature of the game and everyone else is following,’’ says analyst Tom Roderick, who follows Nuance for Stifel Nicolaus & Co.

So you might have expected Nuance’s Feb. 10 announcement of its financial results for the last quarter of 2011 to turn into a kind of victory lap for the company’s role in the iPhone launch that sold so many millions of units.

Here’s what really happened: Nuance’s quarterly revenues fell about $28 million short of forecasts, and the company’s stock suffered its worst day in 18 months.

Sure, quarterly sales and profits were greater than the same period the previous year. And even with the recent slide Nuance shares are up more than 50 percent over the past 12 months. Still, the company came up short of expectations for the final months of 2011.

Nuance executives pointed to contract negotiations that took more time than expected to complete and other complications as explanations for why business didn’t pan out as investors had expected.

But they won’t discuss details of Nuance’s payment arrangement with Apple; rather than get a piece of every iPhone sold, Nuance likely got paid a flat fee for its technology used in Siri.

Roderick believes it’s taking more time to negotiate and work the kinks out of more complex voice-driven products.

“I fall into the camp that believes the last quarter was a misstep and you’ll get a bounce-back this quarter,’’ he says.

Nuance will face another issue in the immediate future. As voice recognition becomes a standard part of technology products, giants like Google Inc., Microsoft Inc., and others loom as potential competitors on an entirely different scale. Apple, a partner with Nuance at the moment, could become a business problem in the future.

For now, Nuance has technology people want. Companies that make mobile phones using Android operating systems are surely keen to knock Siri off her perch with a new product.

“Nuance is certainly going after that market,’’ says Roderick.

But the question at hand is about Apple and what kind of voice recognition capabilities it might build into a new iPad. Don’t bother asking Siri for the answer.

Steven Syre is a Globe columnist. He can be reached at syre@globe.com.
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