On 12th April 2021, Microsoft and Nuance made the announcement of their joint venture as the former company is acquiring the AI firm for $56.00 per share. This implies that Microsoft paid $19.7 billion in an all-cash transaction which is inclusive of Nuance’s net debt. Nuance is a very trusted company when it comes to healthcare and enterprise AI. The current CEO of Nuance will retain his position and will be working under Scott Guthrie, executive vice president of Cloud & AI in Microsoft. Microsoft is aiming to close the deal this year.
What is Nuance?
Nuance is a famous company currently pioneering in conversational AI and cloud-based ambient clinical intelligence for healthcare providers. Healthcare is a very crucial and sensitive sector as it deals with the human body and mind and not just equipment. So, providing quality AI-based solutions to the healthcare sector is a difficult task that Nuance has been conquering. Some of the products of Nuance are Dragon Ambient eXperience, Dragon Medical One, and PowerScribe One. All these products are leading clinical speech recognition software that is built on Microsoft Azure.
Nuance builds its products to work with the core healthcare systems like long-standing relationships with Electronic Health Records (EHRs). This helps to reduce the burden of clinical documentation so that the healthcare workers provide better service to the patients. Nuance’s products are in high demand as it is used by 77 percent of the total hospitals in the US. Apart from the healthcare unit, Nuance also builds AI-based solutions for Interactive Voice Response (IVR), virtual assistant, biometric system, etc.
Why did Microsoft acquire Nuance?
Microsoft has been providing unique cloud offerings to a very diverse customer base. The company has significantly invested and partnered with companies that open new scopes for Microsoft in new areas. One of the new sectors Microsoft is offering is healthcare as the company introduced Microsoft Cloud for Healthcare last year. This new product by Microsoft addresses the needs of the healthcare industry as it is transforming very fast. The acquisition makes it clear that Microsoft is planning to offer better solutions in the healthcare industry with the help of AI.
The company announced a partnership with Nuance back in 2019 which turned out to be very successful. This time both the companies together are planning to augment Microsoft Cloud for Healthcare with Nuance’s solution. Also, Nuance’s expertise and relationship with EHR system providers will be advantageous for Microsoft as it will empower healthcare workers in an improved way. Microsoft is planning to do this by harnessing the power of ambient clinical intelligence and other cloud services of the company.
Moreover, the acquisition of Nuance will double the total addressable market of Microsoft in the healthcare space which in the figure is approximately $500 billion. Both the companies will also strongly commit to data privacy, security, and compliance. Satya Nadella, CEO of Microsoft has said that Nuance provides the AI layer in the solutions it provides to the healthcare sector and it is significantly pioneering the real-world application of enterprise AI.
Harnessing the Power of AI
Currently, AI is the most important and widely used technology that is useful in any sector especially healthcare. Microsoft with Nuance is planning to provide advanced AI solutions to the healthcare sector and medical professionals so that they can make better decisions and more meaningful connections. Since Nuance also provides advanced AI-based solutions in other fields, in the future this will come together with Microsoft’s Cloud including Azure, Teams, and Dynamics 365.
Over the past few years, demand for conversational AI solutions in the healthcare space has significantly increased and Nuance is responding to those needs effectively. But, the room for growth of Nuance is much broader and so is the demand for products it is making. With the help of Microsoft, Nuance can scale globally and try to offer more affordable solutions to people across the world. Microsoft is the right platform through which Nuance will be able to channel its expertise more effectively while Microsoft expands its market at the same time. The deal with Nuance is a very strategic decision that will make Microsoft a very eminent company providing healthcare solutions to the world.
Annasha Dey is an NIT student, who apart from studying engineering is also a content writer. She has a great interest in photography, writing, reading novels, and travelling as well. She is a foodie who loves socializing and hanging out with her friends. She is also a trained Kathak dancer and a big fashion enthusiast. Dey also loves watching TV series, which includes F.R.I.E.N.D.S. and Big Bang Theory. To be a better writer she prefers to read more