PEABODY, Mass., December 30, 2002 - ScanSoft, Inc. (Nasdaq: SSFT), a leading supplier of imaging, speech and language solutions, today announced that Panasonic Digital Document Company has selected ScanSoft® PaperPort® for the new KV-S2025C Production Scanner, the first in a line of Panasonic high-performance scanners. With the addition of ScanSoft's PaperPort, Panasonic customers have more functionality right out of the box, enabling them to instantly manage all scanned paper documents online, quickly and effortlessly.

ScanSoft's PaperPort paper management software is an easy way to turn paper into organized digital office documents. PaperPort allows users to manage scanned documents along with other electronic data in one convenient and easy-to-use filing system on a computer or network. Included with this introductory model in Panasonic's line of high-performance scanners, PaperPort allows users to scan and store exact images of paper documents, from the smallest imaging task to large-scale batch scanning needs.

"Our customers are consistently looking for value-added solutions that make their lives easier and add considerable functionality to their hardware investments," said Charles Vidal, product manager for Panasonic Digital Document Company. "ScanSoft's PaperPort is an incredible addition to this model of high-performance scanners, and provides valuable tools and functionality to help customers digitally manage their critical paper-based assets."

Panasonic's KV-S2025C Production Scanner was honored with the Editors' Choice Award for 2002 in the September issue of Better Buys for Business. The award recognizes the best value in scanners as determined by the magazine's expert editorial staff. In addition to their great speed, the scanners were recognized for "delivering more performance and better features for lower price than their competitors."

ScanSoft's PaperPort offers Panasonic customers:

Fast and Reliable Access to Important Documents: With the intuitive, easy-to-use interface of PaperPort, the scanning process can be performed by anyone within an organization - regardless of technical expertise. PaperPort's electronic file format also supports mixed compression types, so users do not have to decide which file format to use for different documents.
Natural Online Paper Handling: PaperPort provides metaphorical methods of organizing paper that match off-line processes, including stacking groups via drag-and-drop, rearranging and cropping so that scanned documents appear just like the originals.
Editable Digital Documents: Using PaperPort, scanned images can be converted into Word, Excel or text files with a simple drag-and-drop to PaperPort's "Send To" bar. In addition, converted documents can now be electronically completed, resulting in consistent documents in less time.

"Panasonic's new line of full-color production scanners is an ideal opportunity for ScanSoft solutions," said Wayne Crandall, senior vice president of sales and business development at ScanSoft. "Panasonic is providing its customers with the highest-quality paper management solution, which not only adds value for its customer base, but is a natural extension of the hardware functionality."

About Panasonic Digital Document Company

The Panasonic Digital Document Company is the office equipment division of Matsushita Electric Corporation of America, and sells copiers, fax machines, color and monochrome printers, scanners and electronic whiteboards. The company is headquartered in Secaucus, N.J. Matsushita Electric Corporation of America is the principal North American subsidiary of Matsushita Electric Industrial Co., Ltd. (MEI) (NYSE: MC) of Osaka, Japan.

About ScanSoft, Inc.

ScanSoft, Inc. (Nasdaq: SSFT) is a leading supplier of imaging, speech and language solutions that are used to automate a wide range of manual processes - saving time, increasing worker productivity and improving customer service. For more information regarding ScanSoft products and technologies, please visit www.ScanSoft.com.

Trademark reference: ScanSoft, the ScanSoft logo and PaperPort are registered trademarks or trademarks of ScanSoft, Inc. in the United States and other countries. All other company or product names mentioned may be the trademarks of their respective owners.

The statements in this press release that relate to future plans, events or performances are forward-looking statements that involve risks and uncertainties, including risks associated with market trends, competitive factors, and other risks identified in the ScanSoft's SEC filings. Actual results, event and performance may differ materially. Readers are cautioned not to put undue reliance on these forward-looking statements that speak only as of the date hereof.

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