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EU Antitrust to Investigate Microsoft’s $16 Bn Acquisition of Nuance Ideal

Yusuf Balogun
Yusuf Balogun
Yusuf is a law graduate and freelance journalist with a keen interest in tech reporting.

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According to a questionnaire reviewed by Reuters last month, the European Union’s antitrust authority is looking at Microsoft Corp’s $16 billion acquisition of transcription technology provider Nuance Communications Inc and is asking consumers and competitors to submit a list of concerns.

To a source familiar with the situation, an antitrust regulator’s previously undisclosed outreach is the most thorough since the firm announced the merger in April.

Nuance did not respond to a request for comment, and Microsoft declined to comment.

The US Department of Justice in June and the Australian Competition Commission in October decided they would not challenge the deal after a brief assessment. The companies applied to the European Commission’s competition bureau for clearance last month, and the regulator has until December 21 to approve the merger or begin a larger inquiry.

The companies had hoped to complete the transaction by the end of the year but said last month that the deadline could be pushed back to the beginning of next year.

The survey asks if Microsoft and Nuance are competitors and if a merger would have an impact on clients and competitors, such as whether Microsoft would favor Nuance over competitive services.

Nuance specializes in transcribing software, which is popular among doctors and contact centers looking to automate note-taking. According to analysts, the transaction will strengthen Microsoft’s position in the healthcare sector by providing additional voice and medical data to train artificial intelligence services in health, speech, and biometric security.

Like other large computer corporations, Microsoft has developed its business through acquisitions in areas such as advertising and video games for years. In the previous decade, however, Microsoft has escaped the scrutiny that has recently surrounded its competitors, Alphabet Inc’s Google, Facebook Inc, Apple Inc, and Amazon.com Inc, all of whom are facing antitrust lawsuits and investigations over a variety of issues.

Possible worries about the upcoming transaction, according to Steven Weber, a University of California Berkeley professor who studies the interface of technology and health care, include Microsoft imposing its Office suite on Nuance users by bundling them together.

Nuance claims to service 77 percent of hospitals in the United States.

According to former chief executive Paul Ricci and another former employee, ensuring that it could use client data to develop its voice recognition technologies was crucial to its success.

For instance, a Nuance contract with Augusta University Medical Center, obtained by Reuters this year through a public records request, reads, “Customer shall provide Nuance access to voice and text data…and grants Nuance a perpetual, royalty-free license to copy, use and analyze such data for speech recognition research.”

Big cloud companies like Amazon and Microsoft usually don’t have unrestricted access to their customers’ data for research and development. According to former employees, Microsoft’s interest in Nuance stems from the possibility of acquiring those relationships and data.


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