Why Nuance, a speech company, bought Swype

Voice-technology giant Nuance Communications (s nuan) confirmed it has scooped up mobile text software provider Swype for $102.5 million, according to an SEC filing, adding Swype to its stable of voice and text input technologies. The SEC filing said that Nuance will pay $77.5 million now, with the remainder paid 18 months after the closing of the deal.

The acquisition is just the latest for Nuance, which is on a bit of a tear lately, and it reunites Swype founder Cliff Kushler with T9, a predictive text technology that Kushler built at Tegic Communications, which was later bought by Nuance in 2007 from AOL (s aol). While T9 is known for the old-school text input on feature phones, it also includes the same trace-to-type technology that Swype is known for. I’m not sure how Swype and T9 will work together, but it bolsters Nuance’s presence in this area of text entry, especially as other Swype competitors like HTC join in the battle.

Swype has been hugely popular on Android,(s goog) with 50 million installations of its virtual keyboard software as of earlier this summer. The technology allows users to trace their words out by “swyping” their fingers between the letters on a keyboard instead of typing. It’s actually quite fast and has helped break the speed record for text input on a phone. The company has previously raised about $14 million from Samsung Ventures, Nokia Growth Partners, Benaroya Capital, DoCoMo Capital and Ignition Partners.

This is just the latest acquisition for Nuance, which bought speech recognition company SVOX in June and transcription and editing service provider Webmedx in July. It also closed its $157 million purchase of Equitrac, a print management and cost recovery software maker, this past summer. In August, Nuance announced a deal to buy Loquendo, a speech technology subsidiary of Telecom Italia.

Nuance is a major player in voice technology, and as I wrote about, speech is increasingly becoming mobile technology. That’s something we’re seeing more of with the rollout of Siri on the iPhone 4S,(s aapl) which would appear to be powered in part by Nuance technology, though the company has not been able to confirm that. But with the pickup of Swype, Nuance is reminding us that it wants to control all forms of input on devices. While voice is intriguing for many, it’s not a perfect fit for everyone and can’t be used in all circumstances, such as really noisy environments or private meetings. As Nuance CTO Vlad Sejnoha told me, basically all of Nuance’s business is becoming mobile. By picking up Swype, Nuance can be the go-to resource for all kinds of input on a mobile device.