What Microsoft is telling Google about mobile search

Google recently warned investors about the “formidable competition” it faces from number one rival Microsoft, underscoring in particular that Redmond bests Mountain View on the cash resources front.In its acquisition of Tellme Networks, Inc.
Written by Donna Bogatin, Contributor
Google recently warned investors about the “formidable competition” it faces from number one rival Microsoft, underscoring in particular that Redmond bests Mountain View on the cash resources front.

In its acquisition of Tellme Networks, Inc., Microsoft is wagering an estimated $1 billion of its competitive kitty that it will loudly beat search nemesis Google in both the mobile search and local advertising $50 billion games.

Headquartered a shout out from the Googleplex, Mountain View based Tellme’s goal is to "let anyone say what they want and get it, from any phone,” similar to Google’s mission to make the world's information “universally accessible,” on any platform.

In buying Tellme, Microsoft aims to bring the “power of voice technology to everyday life.” Tellme is:

a leading provider of nationwide directory assistance, enterprise customer service and voice-enabled mobile search. Microsoft and Tellme share a vision around the potential of speech as a way to enable access to information, locate other people and enhance business processes, any time and from any device.

Mike McCue, co-founder and CEO of Tellme:

Tellme was founded with the idea that anyone should be able to simply say what they want and get it from any device, starting with the phone. Now, with Microsoft, we’ll be able to extend that vision to millions of businesses and consumers around the world.

This combination allows us to really fulfill our vision and bring it to billions of consumers, literally, on any phone. We love the idea of allowing people to be able to simply pick up a phone, push a button, and say find the nearest Starbucks, and then get a map and driving directions to that location, or be able to push a button and say, give me the latest score on the Yankees.

Last June, while addressing publishing executives over lunch in NYC, Google CEO Eric Schmidt shared his vision for the role of voice in driving local transactions, literally!

Schmidt believes that when he is listening to the radio in his car, radio ads should personally address him about his needs. For example, while driving past a clothing store, a radio ad should remind Eric that he needs a pair of pants and instruct him to turn left at the upcoming clothing store.

Schmidt has publicly shared his “fantasy” about a future Google one-stop advertising shop, for booking the world’s advertising. His musing about the delivery of targeted personalized radio advertising also appears fantastical, as Google has been unable to launch even an “old-school” radio advertising product in the marketplace.

With Tellme, Microsoft does not need to fantasize about voice technology:

McCue: We now have about half of all directory assistance calls are processed on our voice platform, and roughly one in three Americans use Tellme every year to get things done. You might not know it, but it's a Tellme technology powering a lot of these services, whether you call American Airlines to get flight information, or you call Dominos to order a pizza, it's our technology underlying that that has been powering that, and powering our business. It's created profits and good success for the company.

Jeff Raikes, President, Business Division, Microsoft:

One of the key attractions fro us to come together with TellMe was their vision for using their technologies in the mobile search area. We have great strength there with our mobile search and local search. Frankly, today TellMe already does more mobile search support than Google and Yahoo combined.

How profitable has Google been on the mobile front?

Schmidt, Q4 2006 earnings call:

We are investing in new categories of using mobile devices. For example, YouTube content is being used and can be viewed on mobile devices in various partnerships that we're doing. Those are as much opportunistic for us, and they're not really driving revenue yet; although in theory, you could imagine a combination of video, video advertising on a mobile phone that would have the best entertainment value but also very, very high monetization rates. It's not material today in a financial sense. We are making a significant investment in technology around mobile because of the growth rate of mobile and the ultimate scale of that business. You won't really see its financial impact until '08.

How has soon to be Microsoft owned Tellme fared on the revenue front?

McCue: We processed about 2 billion calls a year, last year, on our platform. And we get paid for every one of those calls.

Telllme is looking for even more ways to get paid, currently testing beta multimodal mobile applications.

I heard Sanjeev Agrawal, VP Marketing, Tellme, share his excitement for the new “Tellme by Mobile,” Tellme by Text,” and “Tellme by Voice” platforms at the Kelsey “Drilling Down on Local” Conference last week:

With this capability users can speak a command or enter text and receive interactive data that allows them to quickly find, connect or transact with a business right from their screen. Tellme’s beta product for local search, Tellme by Mobile, is one of the first examples of how voice and visual come together. Anyone can download Tellme by Mobile for free.

Tellme by Mobile, “Say what you want and see it”:

Find any business in America by talking or typing.

Thumbs tired of typing? Now you can use the power of your voice to find a business. Just say what you're looking for and get the address, map, and directions.

Not sure what you want? Just say a category like 'restaurants' or 'pizza'.

Voice-Enabled Search: Just say what you want. No typing necessary.

Just say what you want. No typing necessary.

Interactive Maps: A map in your pocket. Easily navigate a map to find out where to go.

A map in your pocket. Easily navigate a map to find out where to go.

Simplified Directions

Get step-by-step directions. Tellme automatically saves the last business for easy point-to-point navigation, great for running errands.

Tellme has a lot more “great” applications in the works, and is looking forward to Microsoft’s “help.”

Agrawal on the business development landscape:

There are exciting business problems to solve over the next five years. There are efficiencies to be had and money to be made in solving the “last mile” local problem.

McCue on the business opportunity landscape:

One of the things we are really excited about is the idea of combining a voice and visual interface, Tellme By Mobile. It's pretty cool, a cutting edge application.

We think this is representative of how things will ultimately work as the phone gets more and more powerful as the computing device. And similarly with cars, and with the PC, with your television, why do you need to navigate through all these menus on TV when really you should just be able to say, show me The Daily Show, and now you're watching what you want to watch on TV just by speaking to it. So this voice and visual interface, we think, really represents the future, and we're very excited about it.

Google CEO Eric Schmidt can not be very excited, however, that Microsoft has made a billion dollar commitment to “represent the future” in combining voice and visual interfaces on the PC, in mobile, in cars, on the TV...

ALSO: Google’s high-speed battle with Microsoft and Google Local squeezes Yellow Pages, Online Directories and Is Google doing advertising evil with new model? and Google disconnects Google Phone chatter

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