European Commission

EU Approves Microsoft’s $19.7B Nuance Acquisition

The European Commission has ruled that Microsoft’s $19.7 billion acquisition of voice tech mainstay Nuance will not raise any competition or monopoly concerns. The purchase can go through without any conditions from the European Union, clearing a major potential hurdle for the deal following the April announcement of the agreement.

Nuanced Dealings

The EU’s Commission evaluated how much overlap in areas like transcription services, cloud computing, and productivity software Nuance and Microsoft provide. Ultimately, it ruled that their different approaches and products mean there won’t be an overwhelming control of one particular facet of the industry. With plenty of legitimate competition from other companies in the field, the Commission found no reason to be concerned about a lack of choice from consumers. The EU also examined how the data transcribed by Nuance’s products are used, particularly with healthcare, and whether Microsoft’s advertising tech work might take advantage of that sensitive information. The Commission decided that the existing data protection rules and the contracts signed by Microsoft will keep that data private.

“The Commission concluded that Nuance can use this data only to provide its services. It is not used by any other company and cannot be used for any other purpose due to contractual restrictions and data protection legislation,” The Commission wrote. “Also, access to such data does not provide an advantage that would allow Microsoft to shut out competing healthcare software providers given that important transcribed information is typically stored in third-party applications like electronic health record systems that combine data from several sources, as opposed to Nuance’s fragmented speech data.”

Acquisition Approval

The acquisition follows a long history of partnerships between Nuance and Microsoft around voice AI. Still, it will enhance Microsoft’s access and integration of the tech, especially within the enterprise AI market. Nuance’s Dragon Medical Virtual Assistant has run on the Azure cloud platform since 2019, transcribing conversations between doctors and patients and helping fill in electronic health records. Microsoft added virtual check-ups via Nuance to the Teams messaging platform last year as telemedicine exploded in popularity due to the COVID-19 pandemic.

The pandemic accelerated Nuance’s healthcare work over the last year as demand sped up the industry’s testing and adoption of technology. Health technology developer Cerner added the Dragon Medical Virtual Assistant to its platform last summer, for instance, while the U.S. Department of Veterans Affairs (VA) started using Nuance’s Dragon Medical One platform in the fall.  The company launched a COVID-19 and vaccine assistant at the end of last year and recently created a voice assistant for Walgreens to help schedule vaccine appointments. Nuance’s own acquisition of medical voice tech startup Saykara in February will also likely play a role in future Microsoft offerings.

The EU approval is crucial, but there are still possible stumbling blocks from regulators that Microsoft must overcome before the purchase is complete. The United Kingdom’s Competition and Markets Authority investigation has just begun, and the deal will need its OK before it can operate in the UK. Nonetheless, the approval by the EU helps set a tone that may smooth Microsoft’s way to finishing the acquisition and bringing all of Nuance’s tech to bear on its own products.


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