Microsoft Subsidiary Tellme Will Play A Big Role In Windows Phones Coming This Fall

imageAfter laying low since Microsoft (NSDQ: MSFT) bought Tellme two years ago, Microsoft’s Mountain View, Calif.-based subsidiary is announcing that it will play an integral role in the Windows Mobile 6.5 operating due out this fall.

Tellme is best known for its legacy speech-recognition business of answering 411 calls and information lines for other large companies. When Microsoft bought them, it was reaching about 40 million people a month — and it still is. But in mobile, Tellme’s efforts have been mostly limited to a few BlackBerry applications that lets users conduct yellow-page searches. Tellme’s Director of Product Management and Planning Marcello Typrin told me last week that changes with Windows Mobile 6.5, where it is placing the company’s first big bet in mobile.

Tellme is announcing today that it will be deeply integrated into Windows Mobile phones, meaning that users will be able to press a physical button on the phone in order to send a text, make a call or search for information — using voice recognition technology. The software is available now to handset manufacturers, so that it can be launched on the first Windows Mobile 6.5 handsets when they arrive this fall. It will be free to end users.

Typrin said with Microsoft’s help, they’ll will be working closely with handset manufacturers to integrate the software deeply into the hardware. In practice, that means that it may be activated using the new “Start” key that Microsoft is making mandatory on all of its phones going forward. In that scenario, Tellme would be used when a user presses and holds that key. Typrin said gaining access to the hardware was key to making phones easier to use. “Putting an application in a menu defeats the purpose,” he said. “It’s not even a downloadable app. We are doing the right thing by shipping in retail out of the box. We’ve been waiting for that opportunity.”

In this version, Tellme’s service will be integrated with Microsoft’s Live search, allowing for any general search terms, like maps, sports scores, etc. The service will also allow users to say things, such as “Text Wendy,” or “Call Gordon.” While often times speech recognition is difficult to use, Typrin said the service will get smarter as a person uses it more. For example, as you make calls, or send text messages, it will weight names more heavily that are used frequently.

For right now, Typrin said Tellme is viewing the deal as a “good thing for Windows Mobile” because it may drive more Windows device sales. But eventually a revenue opportunity is through search and advertising. They are currently in talks with operators about a revenue-share deals. He also said that despite being owned by Microsoft, Tellme is free to roll out different operating systems. Of course, BlackBerry is one of those opportunities, however, he says they have no plans at this time to launch an application on the platform.