Nuance’s Seattle Office: The ‘Other Guys’ from Tegic and Their Fellow Startup Vets Build A Mobile Innovation Hub
Brad Bargen knows a thing or two about being acquired—he’s actually been through it five times, dating back to General Motors’ 1985 deal for Hughes Aircraft. In the latest phase of his career, Bargen is a leader in Nuance Communications’ mobile R&D hub in Seattle, one of the nation’s most longstanding and vibrant innovation centers for the wireless industry.
Bargen joined Nuance (NASDAQ: NUAN) in 2007, when the Burlington, MA-based speech-recognition company acquired Tegic Communications from AOL for $265 million. Through that deal, Nuance nabbed the keys to the widely used T9 predictive text technology—software that allowed mobile phones with traditional keypads to predict which words users are trying to string together.
It was a big buy for Nuance, and not the last in the Seattle area. The following year, Nuance bought Bellevue, WA’s SnapIn Software, a maker of software for automating mobile customer support, for about $180 million in stock. In 2009, Nuance bought Jott, a speech-to-text startup founded by former Microsofties, for an undisclosed sum. The Nuance Seattle team recently moved into expansive new digs near Pioneer Square, and is looking to expand again—surely one of the reasons they invited the media to drop by and say hi, which I did recently.
Bargen serves as vice president of product development, overseeing text input and customer-service efforts. He’s got an easy laugh, but makes a serious point when he reminds the team that Nuance has put a lot of eggs into its Seattle basket. “I tell people jokingly that we’re the billion-dollar site. It’s pretty easy to get to $1 billion if you start adding up the acquisitions in this building,” he said. “I remind the team of the investment made in the minds in this building, and the building itself, is just a huge commitment.”
Nuance, of course, isn’t the only shop in town counting on Tegic veterans for their core team. Mobile-software startup Swype is one of Seattle’s most-discussed early stage companies, catching the attention of investors and national media. Its product allows users to “type” on a touchscreen keyboard by sliding their fingertip from letter to letter, rather than tapping on each individual key—although Swype recently announced that it was adding old-school tapping to its offering.
Nuance has approached this from the other direction, starting with its XT9 predictive “tapping” product and adding the finger-sliding T9 Trace feature last year. This year, Nuance followed that update with the even more feature-packed Flex T9, which adds voice-to-text to the mix along with tapping, letter-to-letter tracing, and the ability to draw letters or characters in a handwriting style (particularly important in Asian markets).
During our sit-down, Bargen gave me a quick history lesson on the evolution of the T9 technology to its present forms, what he sees for the future of the industry, and the interesting work of mashing up hard-core technology with human culture by studying language around the world.
But one of the first things he pointed out was a distinction he’s noticed from working at startups on one hand, and a company the size of Nuance: The gap between invention and innovation can be large.
Bargen said he thinks of invention as essentially “coming up with something cool. But innovation is getting that out to a bunch of people so that it affects the market. You can be inventive in your garage, but it’s harder to be innovative unless you have the machine to take it all the way to the end and get it on devices and things.” And that’s a roadblock he recalls running into at Tegic.
“We could invent, but we could not innovate. We had demos, but we could never get them out there and we didn’t really have much credibility when it came to talking to OEMs [original equipment manufacturers] and things about speech. But when we came into Nuance, we really started with this notion that we were going to transform the way Nuance put together products on the device,” Bargen said. “And now,finally, it seems like it’s been forever—but we have Flex T9 out there and we have the ability to put Flex T9 on a whole bunch of different devices, including television sets and all of that, because we have the whole deployment machine, the innovation machine. That’s been the fun thing for me.”
XT9 started at Tegic before the Nuance deal—it was a rebuilding of the predictive text input technology that started out in T9. The old version had been built to be extremely data-efficient, since it was going on relatively small devices. With XT9, developers could look ahead to really powerful mobile devices—and they built it to deal with all kinds of future user interfaces.
“The idea was looking toward the future when devices had more horsepower,” Bargen said. “When we started working on, for example, Trace, we had this huge, solid base underneath it of XT9. I mean, Trace is really a feature of XT9. It’s not like a new product in the sense that it’s a whole new code base. It’s sort of an input-output filter on XT9. That’s been fun, and everybody’s really enjoying that. We have a nice rivalry going with the Swype team here.”
A huge area of focus for any company trying to translate human ideas into technical tasks is language, both written and spoken. For Nuance, that effort includes field teams that work all over the world to help document and understand different languages, as well as high-powered computing that crawls the Web to understand how people are using typed language to find things and express ideas.
“One of the things that’s moved forward our language model a lot here for text input, for typing and for tracing, has been the work we’ve been doing with the speech team. Because they use much deeper language modeling and they have a huge store of samples and things that they use for language modeling,” Bargen said.
As for the future, Nuance is working on taking its technology to cars and TVs, Bargen said—a whole new level of complexities to work through, particularly when it comes to autos. That’s underscored by today’s news that Nuance has acquired SVOX, which provides speech-recognition products for cars. So how quickly will we all be talking to our cars and living-room boxes, Jetsons-style?
Bargen says there’s still a pretty big data gap in language recognition—despite all the computing power, years of experience, and PhD-level linguists studying the problems.
“I feel like there’s still a gap there in terms of having data sources where you can say, ‘I’d like to watch an action film tonight.’ Now, you can imagine you’d get a list of action films, but getting more complicated than that, you start running out of data. That’s my impression from some of the work we’ve been doing. So getting the data becomes more of the challenge,” Bargen said.
“If you said, ‘How many phone calls did I make to Uruguay last month?’ AT&T doesn’t expose that level of data to anyone, I’m assuming. So you’re stuck.”
It’s funny how dramatically things have changed in the mobile software business: People like the team from Tegic used to focus on how to shrink their product down as small as possible to use up very little room on a phone. Now, with powerful minicomputers in everyone’s pockets, they’re worried about not having enough data fast enough to perform the magic tricks they really want to do.
“In the beginning, it was very much a problem of being able to compress these lists of words and things just amazingly—to the point where I think it was like one byte a word. It was great compression. But you’re so focused on getting it into a small footprint that there was no temptation to add the frills and things. But now, you have the headroom to add the frills,” Bargen said.