Microsoft on Monday announced that it will acquire Nuance Communications, a deal aimed largely at advancing cloud and artificial intelligence offerings for its healthcare clients .
WHY IT MATTERS
Microsoft is purchasing Nuance for $56 per share – an all-cash trade totaled $19.7 billion, inclusive of Nuance’s net debt. The deal is expected to close later this year.
With the acquisition of Burlington, Massachusetts-based Nuance – that will double Microsoft’s total addressable market in the healthcare provider space, to almost $500 billion – the Redmond, Washington, computing giant will continue to boost its cloud-based decision support, AI-powered analytics and other cloud-based clinical workflow tools.
Mark Benjamin will remain CEO of Nuance, reporting to Scott Guthrie, executive vice president of Cloud & AI at Microsoft.
With healthcare-focused products such as Dragon Ambient eXperience, Dragon Medical One and PowerScribe One for radiology reporting – all built on Microsoft Azure cloud – Nuance has pioneered conversational AI and nearby clinical intelligence for providers .
Its technologies are deployed in over three-quarters of U.S. hospitals and are used by over half of physicians and 75 percent of radiologists nationwide.
Nuance also provides enterprise artificial intelligence and customer engagement technologies – voice, virtual assistants, biometric alternatives – along with other sectors .
Microsoft says its technologies – in combination with Azure, Teams, and Dynamics 365 – can help advance next-generation tools for health care and other clients .
THE LARGER TREND
This big-ticket acquisition traces its origins to a partnership between Microsoft and Nuance, first announced back in October 2019, focused on nearby clinical intelligence to help streamline documentation tasks and alleviate clinician burnout.
Since then , Microsoft has broadened and advanced its own healthcare offerings, most notably the launch in May 2020 of Microsoft Cloud for Healthcare – its first industry-specific cloud product – which aims to assist health system customers with patient involvement , care coordination analytics and telehealth.
ON THE RECORD
“Nuance provides the AI coating at the healthcare point of delivery and is a pioneer in the real world program of enterprise AI, ” said Microsoft CEO Satya Nadella in a statement announcing the purchase .
“AI is technology ‘s most important priority, and healthcare is its most urgent application, ” he said. “Together, with our partner ecosystem, we’ll put advanced AI solutions into the hands of professionals everywhere to drive better decision-making and create more meaningful connections, as we accelerate growth of Microsoft Cloud in Healthcare and Nuance. “
“Over the past three years , Nuance has streamlined its portfolio to focus on the health and enterprise AI segments, where there has been accelerated demand for advanced conversational AI and ambient solutions, ” additional Nuance CEO Mark Benjamin.
“To seize this opportunity, we want the right platform to bring focus and global scale to our clients and partners to enable more personal , affordable and effective connections to individuals and care. The path forward is obviously with Microsoft — who brings intelligent cloud-based services at scale and who shares our passion for the ways technology can make a difference. At the same time, this combination provides a vital opportunity to send meaningful and certain value to our shareholders who have driven and supported us on this journey . “