SIP Trunking News

[June 11, 2007]

Kainos spins off speech business

(Sunday Business Post Via Thomson Dialog NewsEdge) Kainos Software, a Belfast firm with 200 employees, is continuing its trend of spawning new businesses, with the spin-off of its speech recognition business into a new division.

The firm is investing more than $10million (e7.4 million) over the next three years in the new operating division, which is called SpeechStorm.

Kainos was founded 20 years ago. It makes electronic document and records-management software, as well as business process management software. It previously spun out a division to form software firm Meridio.

Oliver Lennon, chief executive of SpeechStorm, said Kainos had been providing speech recognition technology solutions to its clients for the last four years, in addition to its traditional services. The company now hopes to cash in on the growing demand for speech recognition technology with the launch of SpeechStorm as a separate division.

This investment in SpeechStorm enables us to target the market aggressively by expanding our sales capability throughout Britain and further strengthen our existing products, Lennon said.

SpeechStorm has about 15 staff, but expects that number to double to 30 over the coming year. Lennon said the majority of the new staff would be feet on the street, with the firm hoping to recruit sales and marketing personnel for the British market.

SpeechStorm is also hoping to add a number of staff on product development, according to Lennon. He predicted a doubling of revenue from the companys speech recognition technology business as a result of the launch of the specialised and focused operating division.

The majority of Kainoss clients are in the financial services and public services sectors; customers include Bank of Ireland, AIB, Northern Ireland Civil Service and Hibernian.

Lennon said that speech recognition technology was especially useful in these sectors, due to the focus on customer service.

The companys voice recognition technology can be used to allow customers to pay bills or report problems through an automated system.

In the short term, SpeechStorm will focus mainly on the British market, which Lennon said represented about 40 per cent of the market for speech recognition technology across Europe, the Middle East and Africa. He said that the market was quite concentrated in Britain because of the large number of financial services firms operating there.

Lennon said that Kainos was in the process of opening an office in London, which tied in with the companys decision to launch SpeechStorm as a separate division.

The company hopes to raise its profile in Britain and expand its British business with new customers.

In the longer term, Lennon said SpeechStorm would consider opportunities in other big European markets, such as France and Germany. Further down the track, the company will also look to the North American market for further growth opportunities.

Kainos was formed in 1986 as a joint venture between the business incubation unit at Queens University Belfast, ACT Venture Capital and computer firm ICL. It has grown from its initial days as a campus spin-off, and employs just under 200 people, mainly in Belfast.

ACT owns a 31per cent stake in Kainos, and is believed to be the biggest shareholder in the firm.

Kainos had sales of stgGBP11 million (e16.2 million) in the financial year to the end of March 2006 and made a pretax profit of stgGBP41,000, after it recorded a stgGBP400,000 gain from the sale of a fixed asset.

Copyright 2007 Post Publications Ltd, Source: The Financial Times Limited

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