Microsoft Announces Purchase Of Nuance AI Speech Firm For $19.7 Billion
Nuance Communications is a company everyone has heard from but not many have heard of. The company’s technology powers Apple’s Siri voice assistant alongside various communications for healthcare and enterprise organizations. In 2014, it was rumored that Samsung might be interested in purchasing Nuance, but that deal never came to fruition. Now, tech-giant Microsoft has announced a plan to purchase Nuance for a hefty $19.7 billion, including debts, to focus on the healthcare industry.
For quite some time, Microsoft has been working on improving global healthcare with technology and artificial intelligence (AI). In 2020, the company announced the AI for Health initiative to accelerate research, provide global health insights, and reduce health inequity. Moreover, the company expanded on its Cloud For Healthcare initiative, which enabled healthcare providers to work more effectively.
Nuance fits into Microsoft’s equation by way of providing industry-leading “conversational AI and cloud-based ambient clinical intelligence for healthcare providers.” Microsoft reports that Nuance solutions are utilized in 77% of U.S. hospitals, with upwards of 55% of physicians and 75% of radiologists taking advantage of the tech. With the acquisition, Microsoft can augment the Cloud For Healthcare initiative to “empower healthcare providers through the power of ambient clinical intelligence and other Microsoft cloud services.”
Beyond the focus on healthcare, companies in all industries use Nuance’s AI expertise and customer engagement technology across many products. With Microsoft’s partnership, this technology can be paired with Azure, Teams, and Dynamics 365 to “deliver next-generation customer engagement and security solutions.”
According to Microsoft’s blog post, the transaction has been approved by the Board of Directors of both companies and is expected to close by the end of the year. The agreement details that Microsoft will pay $56.00 per share, a 23% premium over the closing price on April 9th. Besides the financials, which make this a large deal, Microsoft’s healthcare market share will increase dramatically. Thus, we could see cloud and AI integrations in healthcare increase dramatically, and it will be something to watch shortly.