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By Rob Garretson
Apple is quietly acquiring San Jose-based start-up Siri, a developer of voice recognition and search technology for smartphones, in an apparent bid to compete with Google and the voice-activated Web search features of the Android platform.
Siri, a spin-off of high-tech incubator SRI Institute, began offering its iPhone voice recognition and search application, which it calls a “virtual personal assistant,” earlier this year. The application lets users speak or type commands in plain English -- for example, “Siri, where’s the nearest Starbucks?” -- and the application uses voice recognition and search algorithms to find results. Through partnerships with Web services such as taxi dispatcher Taxi Magic and restaurant reservation service OpenTable, the Siri application can fulfill voice commands such as “call me a cab” and “book me at table” at a specific restaurant.
The acquisition was first reported yesterday by technology blogger Robert Scoble, who found it listed on a Federal Trade Commission listing of acquisitions that received early termination of the waiting period under the Hart-Scott-Rodino Act, meaning the FTC and Department of Justice have completed their antitrust review and won’t block the deal.
Prior to its acquisition by Apple, Siri had reportedly raised a total of $24 million from investors, including Menlo Ventures, Morgenthaler Ventures and the foundation run by Chinese billionaire Li Ka-Shing -- who has also invested in Facebook -- as well as SRI International.
Siri grew out of an SRI project called Cognitive Assistant that Learns and Organizes (CALO), which was funded by a $150 million Defense Advanced Research Projects Agency investment. The five-year CALO Project included 25 research organizations and institutions, and Siri was spun off to create a consumer application for the technology.
Industry observers see Apple’s acquisition of Siri as a counter to Google’s heavy investment in voice-command search and location-based services, not only built into its Android mobile operating system but also available and under development for Apple’s iPhone, iPod Touch and iPad.
Apple, which faces increasing competition from smartphone leader Research in Motion and Palm, once its acquisition by HP is complete, has stepped up its purchasing activity recently to keep pace. An Apple spokesman noted that the company buys smaller firms from time to time and declined to comment on plans for Siri, but on Tuesday Apple announced the acquisition of chip designer Intrinsity and in January acquired mobile-ad network Quattro Wireless for $275 million, prior to its introduction earlier this month of its iAd advertising platform that will run ads directly within applications for iPod, iPhone and iPad.
Yesterday, ad industry executives made headlines by predicting in the Wall Street Journal that Apple could charge advertisers five to ten times the going rate for ad campaigns created for iPhone and iPad apps. The price could reach as high as $1 million for iPhone and iPad ads, based on the growing user base for the devices, compared with $100,000 to $200,000 for comparable mobile ad deals, they suggested.
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