In February there was a rumor that Microsoft was acquiring mobile phone applications vendor Tellme, but it was promptly denied. Now the rumor is back and the purported price tag is a whopper according to Om Malik:
The talks continue, but some of our sources say don’t expect an announcement Tuesday. The two outlets speculate that Tellme could fetch up to $800 million, but our source, someone quite familiar with the company say that the price is north of the reported numbers.
Even an $800 million price tag would make it the fourth largest acquisition in the history of Microsoft. Why would Microsoft pay such a hefty price? C/Net speculates that the Tellme technologies could find their way into enterprise applications. Microsoft is betting heavily on the convergence of data and voice.
The real reason will be Microsoft Mobile and non-PC devices where Tellme’s voice interface and back-end server technologies can come in quite handy.
“The leading edge battleground between us and Google in local search really will come on the phone,” Microsoft Chief Executive Steve Ballmer told the WSJ back in May 2006.
Both explanations could be correct since Microsoft’s Unified Communications Group is part of Microsoft’s Business Division (mostly Office) under Jeff Raikes who was suggested as the receiving executive in the CNET article. I’m still puzzled how Tellme’s open standards platform and Java mobile phone client fit in with Microsoft’s mobile plans, but if the deal goes through, I’m sure we will be treated to some sort of explanation.