Nuance Acquiring Tweddle Connect

Some people may never know what spurred it, but they may see new cars communicating with them and other functions following this acquisition.

Nuance Communications announced it has signed an agreement with Tweddle Group to acquire the Tweddle Connect business.

Tweddle Connect is an application and content service delivery platform for in-car infotainment systems, including the Toyota Entune and Lexus Enform App Suite.

Tweddle Connect aggregates third-party applications and content, such as Bing, iHeart Radio, OpenTable and Pandora, and is described as delivering it safely and securely into the driving environment.

Nuance said the combination of Dragon Drive, Nuance’s automotive-grade voice platform, and Tweddle Connect provides automakers with a single set of services to create branded personal assistant experiences for a safer, smarter connected car.

Already shipping in more than 20 million cars each year, Nuance’s voice, text-to-speech and natural language understanding solutions power Audi, BMW, Chrysler, Ford, General Motors, Hyundai, Toyota and many other automakers’ systems.

Nuance’s Dragon Drive voice solution supports a range of functionality like voice dialing, message dictation, navigation, local business search, music search, climate control and more.

Nuance also stated that the combination of Nuance’s Dragon Drive and Tweddle Connect bridges the current gap between voice, on-board applications, and connected third-party applications and content. Tweddle Connect’s end-to-end service delivery platform will be combined with Dragon Drive’s hybrid embedded-connected voice platform to provide automakers a single, turn-key solution that offers voice, natural language understanding, dialog management, expressive text-to-speech, in-car connectivity, apps, content and dynamic application user authentication – all integrated as part of one holistic offering.

Tweddle Connect provides a communication link between its cloud-based services and the car’s electronic system, as well as an integration layer for smart phone applications. Consumers, dealers, or automakers can manage apps and content through an online secure user portal. Dynamic authentication gives drivers the ability to automatically connect to their favorite apps and services as soon as they enter the car.

This acquisition accelerates and broadens Nuance’s participation in the large and rapidly growing connected car market.

According to ABI Research, the number of US connected car subscriptions will grow at a 30 percent compound annual growth rate from 16 million in 2012 to 53 million in 2017.

Automotive News estimates that the global installed base of connected cars will reach 210 million by 2016.

At the heart of this rapid growth is strong consumer demand for in-car access to voice-enabled personal assistant capabilities they have come to love on their smartphones, coupled with additional car-specific applications, such as roadside assistance, real-time traffic and location-based services.

The JD Power 2012 U.S. Automotive Emerging Technologies Study on consumer demands for in-car technology found that 69 percent of respondents want natural language voice activation and 68 percent want wireless connectivity in the car.

The purchase price for the acquisition is approximately $80 million in cash. Nuance expects to close the transaction in Q3 2013.

Nuance will acquire Tweddle Connect’s existing revenue streams, as well as the cash flow and revenue streams associated with ongoing shipments. Nuance expects to drive growth by leveraging existing relationships with the top auto makers and Tier 1 suppliers, as well as Nuance’s operational expertise in managing high-volume hosted services.

“We see explosive growth in the connected car market, and there is clear demand from automakers to deliver safer and more intuitive access to the content and apps that people know and love,” said Michael Thompson, Executive Vice President and General Manager, Nuance Mobile. “The strategic combination of Nuance and Tweddle Connect will greatly improve the ability to bring an important category of content – third party applications and web services – into connected car systems. With this acquisition, Nuance is leveraging an opportunity to increase the value and usability of connected car systems, while accelerating Nuance’s ability to give automakers the elements needed for branded, differentiated connected car experiences.”