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Microsoft officializes the purchase of Nuance with health in mind

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Microsoft today agreed to acquire Nuance Communications for $ 19.7 billion. In a post announcing the agreement, the company said it was about increasing its presence in the healthcare vertical, a place where Nuance has performed well in recent years.

In fact, the company announced Microsoft Cloud for Healthcare last year, and this deal aims to accelerate its presence. Nuance’s products in this area include Dragon Ambient eXperience, Dragon Medical One and PowerScribe One for radiology reporting. “Today’s acquisition announcement represents the latest step in Microsoft’s industry-specific cloud strategy,” wrote the company. The acquisition is also based on several integrations and partnerships that the two companies have made in recent years.

The company has 10,000 health customers, according to information from the website. That includes AthenaHealth, Johns Hopkins, Mass General Brigham and Cleveland Clinic, to name a few, and it was this customer base that attracted Microsoft to pay the price it paid to bring Nuance to the group.

Nuance CEO Mark Benjamin will remain with the company and report to Scott Guthrie, Microsoft’s EVP responsible for the cloud and AI group. Nuance has a complex history. It went public in 2000 and started buying voice recognition products, including Dragon Dictate by Lernout Hauspie in 2001. It merged with a company called ScanSoft in 2005. That company started out as Visioneer, a digitization company in 1992.

Microsoft officializes the purchase of Nuance with health in mind

Today, the company has a number of products, including Dragon Dictate, a text-to-speech product for consumers and businesses that dates back to the early 1990s. It is also involved in speech recognition, chat bots and natural language processing , particularly in the health and other sectors.

The company has 6,000 employees spread across 27 countries. In its most recent November 2020 financial report, which went to Q42020, the company reported $ 352.9 million in revenue compared to $ 387.6 million in the same period last year. This is not the direction a company wants to go, but it is still an execution fee of more than $ 1.4 billion.

At the time of this conference call, the company also announced that it was selling its Go-Live medical transcription and electronic health record (EHR) services to Assured Healthcare Partners and Aeries Technology Group. The company’s CEO, Benjamin, said the goal was to help the company focus on its core speech services. “With this sale, we will reach an important milestone in our journey towards a more focused strategy of advancing our conversational AI, natural language understanding and clinical environmental intelligence solutions,” said Benjamin in a statement at the time.

It is important to note that Microsoft already has a number of its own speech recognition and chat bot products, including desktop voice for text services on Windows and Azure, but has had a chance to buy a market leader and deepen in the health sector.

The transaction has already been approved by the company’s board of directors and Microsoft informs that it expects the deal to close by the end of this year, subject to standard regulatory oversight and approval by Nuance shareholders.

That would mark Microsoft’s second largest purchase to date, surpassed only by the $ 26.2 billion that the company paid for LinkedIn in 2016.

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