Nuance to Acquire SNAPin Software and Put Revolutionary Self-Service into the Hands of Mobile Consumers Worldwide

Acquisition Expands and Accelerates Nuance Strategy for Mobile Care; Provides Extraordinary Economic Returns for Mobile Operators and Corporations Worldwide

LONDON, UK., August 20, 2008 – Nuance Communications, Inc. (NASDAQ: NUAN) today announced a definitive agreement to acquire privately-held SNAPin, a provider of mobile device and server self-service technology.  With the strengths and resources of Nuance and SNAPin, the combined organisation can deliver innovative, highly scalable mobile customer care solutions that transform the way mobile operators and enterprises interact with consumers in real-time on mobile devices.

With this acquisition Nuance is uniquely positioned to address the significant global opportunity in customer care as it converges around the mobile phone as the primary consumer access point. Companies worldwide will employ more than six million agents and spend more than $100 billion in customer care in 2008.  In addition, estimates suggest that more than 200 billion calls are placed into customer service numbers around the world every year.  An estimated one-third of those calls are placed from mobile phones and the number is expected to grow to two-thirds before the end of the decade.  A Nuance and SnapIN combination can deliver effective care for cents-per-call compared to agent-assisted calls that approximate $4.50 per call on average.

“The integration of Nuance’s mobile solutions and enterprise speech solutions allows Nuance to sharply reduce the costs of customer care and improve the quality of customer experience for mobile operators and large enterprises,” said Steve Chambers, president of the Mobile and Consumer Services Division at Nuance. “Leveraging the proliferation of mobile devices worldwide, Nuance’s solutions, combined with powerful technology from SNAPin, enable Nuance to deliver the economies of Web-based self-service to the growing expanse of mobile consumers.”

By combining SNAPin’s key intellectual property, mobile expertise and established device and operator relationships with Nuance’s robust capabilities in customer care and handset solutions and longstanding mobile and enterprise relationships, the Company is positioned to deliver superior mobile care solutions and fulfill a significant global opportunity that has captured the interest of the world’s largest mobile operators.

As an example, Vodafone is using SNAPin’s software to provide its customers with the ability to automatically resolve common requests – diagnose and repair configuration problems, make account inquiries and solve problems – directly on their mobile phone.  “Delivering a superior customer experience at all touch points for our subscriber is key to how we acquire and retain loyal customers," said Adam Spence, group self service development manager for Vodafone Group. “We are excited by the joining of Nuance and SNAPin as it reinforces our strategy to offer our customers the most innovative and powerful mobile self-service experience across all of our established and emerging markets.”

Nuance expects the acquisition in fiscal 2009 to add between $29 million and $32 million in non-GAAP revenue; $19 million and $22 million in GAAP revenue after adjusting revenue lost to purchase accounting; non-GAAP earnings between $0.01 and $0.02; and a GAAP loss between $(0.05) and $(0.06) including amortization and stock-based compensation. See “Discussion of non-GAAP Financial Measures” below for further information.  SNAPin solutions are delivered through the handset in a revenue model based on the value of transactions or calls served on the handset.  Nuance has experienced rapid growth in its mobile business for the last several years and now anticipates combined mobile revenues in Fiscal Year 2009 between $260 and $275 million.

Under the terms of the agreement, consideration for the transaction is approximately $180 million in Nuance common stock.  SNAPin’s shareholders will be eligible for additional earn-out consideration based upon the achievement of certain financial and operational milestones.  The transaction is expected to close in October 2008, subject to customary closing conditions and approvals, and is expected to be accretive in fiscal 2009.
 
SNAPin is a pioneer in the field of on-device self-service and customer care, with patented technology that provides mobile operators with solutions that help subscribers automatically resolve common problems directly on their handset.  Additionally, the software delivers interactive offers and promotions in a relevant, context sensitive way based on how the handset is being used in order to help mobile operators boost usage levels, increase revenue and enhance loyalty. For a demonstration of the SNAPin solutions, please visit http://www.snapin.com/prod_click_thru.html.

“We are excited to join Nuance, a dynamic company that shares our commitment to deliver innovative technology and compelling user experiences for the world’s mobile consumers,” said Robert Lewis, SNAPin president and chief executive officer.  “Joining Nuance will help accelerate the adoption of our mobile care technology by providing us deeper relationships with carriers and every major handset vendor, access to expansive complementary mobile technologies, broad intellectual property, deep mobile talent and experience from thousands of successful care implementations worldwide.”

“The addition of SNAPin brings many advantages and synergies that are expected to benefit Nuance and complement its presence among carriers, enterprises and mobile OEMs,” said Mikael Berner, vice president and general manager, Mobile Care, at Nuance.  “SNAPin has successfully completed numerous commercial deployments and pilots with leading mobile operators and through partners including EDS, IBM, KPN, Microsoft, Nokia, Orange UK, Symbian, T-Mobile USA and Vodafone Group.  They have in place long term contracts representing more than 250 million subscribers worldwide.”

The SNAPin acquisition brings key intellectual property that complements Nuance’s IP portfolio.  SNAPin has been awarded U.S. patent #7,353,016, titled “Call Intercept Methods, Such as for Customer Self-Support on a Mobile Device,” that provides strong IP position in this robust market and validates a foundation of innovation at SNAPin.  The patent covers among other things the call intercept feature in SNAPin’s SelfService Care product, which intercepts a subscriber’s call to customer care. After the call is intercepted, a personalized menu is displayed to help the subscriber solve their own problem, directly on the device.

In addition to an innovative product portfolio, SNAPin brings an experienced and dedicated team of engineers, business leaders and industry experts in the field of mobile technology.  Combining the technical expertise of this talented team with the global resources and market strength of Nuance will create a combined organization that can accelerate the delivery of innovative customer care solutions for the mobile market