Speech and Voice recognition: One of the fastest growing AI segments
Gupshup acquires Knowlarity for $100 million
On 2nd Feb, Gupshup – a San Francisco headquartered conversational messaging services company – acquired Knowlarity Communications for about $100 million. Knowlarity is a Singapore headquartered company that provides cloud-based telephony and customer service automation solutions to more than 6,000 enterprise customers, catering to the BFSI, Consumer, Technology and Healthcare verticals.
Over the last 2 years, there have been a number of investments by venture capital firms and strategics alike in the voice communication space. While companies such as Google and Amazon are early entrants in the space, companies such as Knowlarity and Gupshup have gained significant traction over the last 12 months. Gupshup itself raised over $350 million in 2021 and is valued at over a $1 billion.
Speech and voice recognition market worth $22 billion by 2026
In 2021, Microsoft acquired Nuance Technologies for over $19 billion in an all-cash deal, marking one of the largest transactions in the conversational AI space. In India, Google invested in Slang Labs, one of the leading providers of In-App voice-assistant-as-a-service.
The growing demand for voice-enabled devices and solutions, including speech enabled shopping, smart home devices, and wearables are driving rapid growth of the speech recognition market. Automatic speech recognition (ASR) as a segment is expected to record the highest growth over the next 5 years, and number of companies are investing in their own vertical specific ASR, outside the ecosystems of Google and Amazon.
Language and mobile adoption driving growth in the Indian market
The Indian commerce and related services market has seen exponential growth over the last 10 years. India is a key market for Amazon, and home-grown unicorns such Flipkart, Zomato and Swiggy are valued at over $10 billion.
However, a vast majority of the market remains untapped and fragmented. Growth has primarily been driven by English speaking consumers in urban areas. The tier 2 cities and rural areas present unique challenges for global commerce and service-oriented companies because of multiple languages and dialects.
While mobile penetration is expected to grow to over 90% by 2040 (from 50%+ currently), commerce players need to bridge the language barriers – voice recognition features in apps are key to achieving this incremental growth. India’s diversity presents a huge opportunity to players in the voice AI space, and we expect global players to drive significant investments in the space over the next few years.
Source: Press release, news reports
1) Other investors were Salesforce Ventures and Lightspeed Venture Partners