Watching the Startups: Voicemail to Text - The Real Debate: Who Will Pay Extra for It?

Ho with Current Analysis says that from what he has seen thus far, the speech recognition technology driving these services is good enough for the standard business person. All three of the major vendors claim a 95 percent accuracy rate or better. The real debate is whether users will be willing to pay extra for voicemail after years of having the service baked into the typical phone bill, Ho says.

“The question is how to wean them off the free stuff,” Ho said. “There are certainly going to be a lot of people who say, well I like it but I don't like it enough to pay for 10 dollars a month.”

Ho believes that there is still a great deal of uncertainty in the market when it comes to service delivery and subscription models. This is one of the key differentiators between SimulScribe, CallWave and SpinVox, which each has its own approach to spreading voicemail-to-text within the marketplace.

SimulScribe has chosen to go primarily direct to consumer, with occasional deals such as the one that it brokered with Vonage in April 2007. Its product is a pure voicemail-to-text offering with multiple tiers based on the number of voicemails processed each month.

“Our customer is typically that business user who is part of a corporation but has enough disposable income to pay out of pocket to have better communication products,” Siminoff said.

SpinVox offers a similar pricing structure but has chosen to focus its efforts on negotiating carrier deals and partnering with enterprise unified communications vendors to integrate directly into their product lines. Though it hasn’t announced any major deals in the latter category, last year SpinVox won accounts with Rogers Communications and Altel Wireless.

Finally, CallWave is also attacking the direct-to-consumer angle, but it hopes to attract users based on its overall communications package. Vtext is only one part of the technological puzzle in its new Virtual Voicemail Suite, which also includes real-time mobile call screening, as well as a personalized "content locker" for mobile applications.

Though there is really no clarity on which model will prevail, Ho believes that the market will likely cause all players to adjust eventually. “Like with any start-up you go with one idea, you tell the idea to your VCs and then the reality of the marketplace makes you adapt,” said Ho.