New Survey of UK Consumers Reveals High Demand for Secure Speaker Verification Solutions from Telco’s and Banks

91% of Financial Services Consumers and 79% of Telecommunications Consumers Have Fraud Concerns with Current Methods of Identity Verification When Accessing Their Accounts

London, June 4, 2008 – Nuance Communications, Inc. (NASDAQ: NUAN), a leading supplier of speaker verification solutions today released the results of research conducted by Harris Interactive, which revealed that close to 60% of UK consumers admit to forgetting security passwords, and 80% believe there are security gaps in the methods currently in place for confirming identity when accessing their phone and banking accounts.

The 2008 Secure Identification Survey conducted for Nuance by Harris Interactive, a leading independent research organization, contains responses from over 500 consumers over 18 years of age who have interacted with customer service in the past 12 months. The 25-minute survey focused on security and identity verification, providing specific insights for telecommunications- and finance-based account access. The survey gathered information on the perception and satisfaction of traditional security methods, such as challenge questions by a live agent and PIN/password schemes, as well as new approaches, such as voice biometrics, retinal scans and more.

Key Findings of the 2008 Secure Identification Survey for the UK:

• There is a need for alternatives: A meager 21% of respondents had no concern regarding access fraud with their telecommunications account, and an even lower 9% had no concern regarding access fraud regarding their bank account - leaving 80% to 90% of consumers who have concerns of fraudulent access to their telco and bank accounts.
• PIN/challenge schemes create security gaps: While the majority of respondents used password/PIN and challenge question schemes to prove their identity with the service provider, 58% admit that they have forgotten their secure information in the past. Writing down forgotten PINs, reusing passwords across multiple accounts and using publicly accessible information on birthdates and mother’s maiden names are just some of the security gaps associated with PIN-based security.
• Perception of speaker verification is strong: Perceptions are strong that speaker verification is superior to current authentication methods.
  • 47% believe speaker verification is more secure than PIN-based systems, increasing to 79% who believe speaker verification is more or as secure;
  • 47% believe speaker verification is more secure than challenge questions, increasing to 77% who believe speaker verification is more or as secure.
• Strong foundation for acceptance of speaker verification: While still a new technology, 83% of respondents already believe that speaker verification technology is a secure way to protect account access. This high level of acceptance is echoed in the finding that 74% would already be likely/somewhat likely to use a speaker verification service for accessing their accounts. These findings should help to assure organizations that any investment in speaker verification systems will result in strong acceptance and use by their customers.
• Convenience also plays a role: While the top two reasons for using speaker verification are security related, 38% of respondents indicated reasons of convenience including ‘it is easier than other verification methods,’ ‘won’t have to remember password/PIN,’ and ‘would reduce the call duration.’
• Speaker verification for market advantage: 55% of respondents stated that they “would prefer to do business with a company that offers speaker verification” as an enhancement to their security system. This will provide forward-looking organizations with the opportunity to position higher levels of security as a differentiator in the market place, similar to Toyota successfully gaining market advantage with the green-friendly Prius automobile, and Volvo with their emphasis on safety

“According to Cabinet Offices figures, in the UK in 2006, approximately 80,000 cases of identity and impersonation fraud were identified, costing the economy £1.5 billion. It is no surprise then that consumers are looking for improved security and view speaker verification as more secure than traditional means most often used today,” said Ian Turner, General Manager Northern EMEA at Nuance. With over 300 companies worldwide that have already licensed speaker verification solutions from Nuance, and with independent research, we know that organizations now have the opportunity to improve security in a way that will work, and that their customers will accept and use.”

About Nuance Communications, Inc.

Nuance is a leading provider of speech and imaging solutions for businesses and consumers around the world. Its technologies, applications and services make the user experience more compelling by transforming the way people interact with information and how they create, share and use documents. Every day, millions of users and thousands of businesses experience Nuance’s proven applications and professional services. For more information, please visit: www.nuance.com.

About Harris Interactive

Harris Interactive is a global leader in custom market research. With a long and rich history in multimodal research that is powered by our science and technology, we assist clients in achieving business results. Harris Interactive serves clients globally through our North American, European and Asian offices and a network of independent market research firms. For more information, please visit www.harrisinteractive.com.

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