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Belgian Co. Carves High-Tech Niche

March 21, 2000

BRUSSELS, Belgium (AP) _ Anyone bookmarking Europe’s high-tech standouts would find it difficult to ignore the Belgian company Lernout & Hauspie, a leader in voice recognition, language and artificial intelligence software.

Speech technology still sounds largely pie-in-the-sky today. Applications that allow the human voice to accurately manipulate machines _ or computers that faithfully transcribe spoken words _ remain relatively crude.

But Lernout & Hauspie have been at it since 1987, developing technologies that open doors with voice commands, allow handsfree Internet surfing and translate spoken words into written sentences.

``The strength of L&H is that it is the sole company to cover all speech technologies″ while rivals focus on more narrow markets, says Kurt Janssens, an analyst at KBC Securities, Belgium’s second largest financial services group.

L&H employs more than 1,100 linguists and boasts 50 patents for products that includes ``Clinical reporter″ (which lets doctors dictate prescriptions that are then archived in script), ``Easy Language″ (interactive learning of 61 languages), ``iTranslator″ (dictionary-based translation software) and ``Now You’re Talking″ (allows Web-surfing by voice).

In March, the company spent $511 million to buy Dictaphone Corp. of the United States _ the company founded in 1888 by Alexander Graham Bell, inventor of the telephone. Dictaphone provides 60 percent of U.S. hospitals with digital dictation and recording products.

The purchase gives L&H a commanding position in the medical field, which screams for voice dictation software.

Industry analysts predict speech-technology software will be a global business worth some $8 billion by 2003, up from just $500 million in 1997.

L&H insists speech-recognition software will be embedded in computers in only a few years. U.S. technology giants Intel Corp. and Microsoft Corp. are betting it’s right. Both have invested in L&H and formed joint language technology ventures.

But while L&H’s 1999 revenues of $344 million were up 63 percent from 1998, Lehman Brothers analyst Brian Skiba says its core voice-recognition software business is not growing fast.

Interest in retail voice-recognition software is picking up, however, in the United States, where L&H competes with Dragon Systems Inc. and IBM Corp. as well as Koninklijke Philips Electronics NV of the Netherlands.

In commercial applications, Nuance Corp. and Lucent Technologies Corp., both of the United States, are strong in speech technology for call centers.

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On the Net: L&H at http://www.lhs.com

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