Apple has reportedly been in talks with Nuance (a voice recognition company) for several months, suggesting that the Cupertino, CA company is planning on incorporating a more intelligent voice recognition service within a future version of the iOS.

The news comes from TechCrunch, who notes that various “sources” have confirmed the news. However, before we start to talk about a possible Nuance acquisition (and how such a move might influence the iOS), let’s talk about what’s already happened.

Last year, Apple purchased Siri, Inc. for a rumored sum of around $200 million. If you’re not familiar with the service (and the iOS app), Siri is the ultimate personal assistant: Ask the app – Siri Assistant – a question, and it’ll give you a very reasonable answer. Interestingly, you can check out the app yourself – it’s still available in the App Store (for free), although it hasn’t received an update since last October.

Following the purchase of Siri, Inc., we heard (in March) that the company’s technology was to be “deeply integrated” within a future version of the iOS – most likely iOS 5, which we expect to be previewed at WWDC in June.

However, there’s more.

What makes Siri Assistant tick, is the voice recognition technology it encompasses. This is provided by Nuance, the developer of Dragon Dictation. Apple acquired Siri, Inc., and Siri Inc.’s Siri Assistant app uses technology developed by Nuance. Which would suggest that, if Apple wants to incorporate Siri technology within the iOS, it’s going to have to knock at Nuance’s door. Either that, or Apple will have to develop the voice recognition technology itself.

Apple might do this, but TechCrunch‘s sources suggest otherwise – that Apple has been in talks with Nuance CEO Paul Ricci, who “can be as hard of a negotiator as Apple’s own Steve Jobs.” It would appear that Apple wants Nuance technology to be used in a future version of the iOS, but the company itself is too pricey to purchase. According to TechCrunch:

So why doesn’t Apple just bite the bullet and buy Nuance? Well, for one thing, the company is very expensive. Nuance is a public company whose stock just so happens to be near its all-time highs. At the time of the original Apple/Nuance talk, their market cap was around $5 billion. Now it’s $6 billion. And it would take considerably more than that for Apple to buy them.

Nuance’s hard bargaining suggests that Apple is struggling to come to an arrangement with the company, resulting in the ongoing negotiations TechCrunch reports. With an expected iOS 5 preview set for WWDC (of course, it could be as late as fall, but most expect a preview – at least – in summer) Apple is going to have to figure something out fast.

If Apple is able to strike a deal with Nuance, we can expect to see a Siri Assistant like Apple developed app ship with iOS 5. Alternatively, Apple could simply expand its Voice Control service to provide answers to a larger range of questions, and follow a higher number of commands. Personally, I think the current Voice Control service works rather well – although there’s definitely room for improvement.

Hopefully, Apple and Nuance will strike a deal. Would you appreciate an improved Voice Control service, or a Siri Assistant like app to ship with iOS 5? Let us know in the comments.