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Wednesday, May 5, 2021

Microsoft buys AI speech tech firm Nuance for $19.7 billion

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Microsoft is buying AI speech tech firm Nuance for $19.7 billion, bolstering the Redmond, Washington-based tech large’s prowess in voice recognition and giving it additional leverage within the well being care market, the place Nuance sells many merchandise. Microsoft can pay $56 per share for Nuance, a 23 % premium over the corporate’s closing value final Friday.

Nuance is greatest recognized for its Dragon software program, which makes use of deep studying to transcribe speech and improves its accuracy over time by adapting to a consumer’s voice. Nuance has licensed this tech for a lot of companies and functions, together with, most famously, Apple’s digital assistant Siri. (Although to what diploma Siri presently depends on Dragon to reply customers’ queries is unclear.) Dragon is an trade chief when it comes to transcription accuracy.

The $19.7 billion acquisition of Nuance is Microsoft’s second-largest behind its buy of LinkedIn in 2016 for $26 billion. It comes at a time when speech tech is enhancing quickly, because of the deep studying increase in AI, and there are concurrently extra alternatives for its use.

Digital transcription has grow to be extra dependable in a variety of settings, from medical consultations to board conferences and college lectures. The uptick in distant work has additionally created new alternatives. With so many conferences happening by way of video, it’s simpler to supply prospects transcriptions by way of software program built-in instantly into these calls. Zoom, for instance, provides automatic transcription by way of integration with third-party companies like Otter.

For Microsoft, which makes roughly two-thirds of its income from enterprise software program gross sales and cloud computing, enhancing its transcription companies for eventualities like these makes full sense. The corporate might combine Nuance’s expertise into its present software program, like Groups, or supply it independently as a part of its Azure cloud enterprise.

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The rapid focus, although, can be on well being care, the place the 2 corporations have already labored collectively. In 2019, they introduced a “strategic partnership” to make use of Nuance’s software program to digitize well being information for Microsoft’s shoppers. Nuance’s well being tech, together with its Dragon Medical One platform, which is tuned to determine medical terminology, is reportedly utilized by greater than half 1,000,000 physicians worldwide and in 77 % of US hospitals.

“By augmenting the Microsoft Cloud for Healthcare with Nuance’s options, in addition to the good thing about Nuance’s experience and relationships with EHR programs suppliers, Microsoft can be higher in a position to empower healthcare suppliers via the facility of ambient medical intelligence and different Microsoft cloud companies,” mentioned Microsoft in a weblog submit.

“Nuance gives the AI layer on the healthcare level of supply and is a pioneer within the real-world utility of enterprise AI,” mentioned Microsoft CEO Satya Nadella in a statement. “AI is expertise’s most essential precedence, and healthcare is its most pressing utility. Collectively, with our accomplice ecosystem, we’ll put superior AI options into the arms of pros in all places to drive higher decision-making and create extra significant connections, as we speed up progress of Microsoft Cloud in Healthcare and Nuance.”

Information of the Nuance acquisition was first reported over the weekend by Bloomberg, and it’s the most recent instance of Microsoft’s buying spree. Final month, the corporate accomplished its $7.5 billion acquisition of games company ZeniMax. Final yr, it was considering an acquisition of social video app TikTok, and the corporate can be reportedly in “exclusive talks” to buy communications app Discord.

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