Microsoft Reportedly in Advanced Talks to Acquire Nuance Communications Inc.

By Bill Toulas / April 12, 2021

Microsoft is reportedly close to announcing the acquisition of AI and speech recognition expert Nuance Communications Inc. The relevant report comes from Bloomberg, which invokes sources familiar with the matter and presents an acquisition price of $56 a share, reaching a total deal amount of $16 billion. If the deal goes through, it will be the second-largest ever for Microsoft, behind only the $24 billion paid in 2016 for the acquisition of LinkedIn.

It would be a key move for Microsoft, as the tech company cannot afford to fall behind in AI. The company focuses on cloud services where artificial intelligence is entering very aggressively, making a big difference, so you can’t have the one without the other. Google and Amazon, two of Microsoft’s largest competitors in the field are already ahead with their own AI tools. To be fair, Microsoft does have an AI and speech recognition development program in-house and has spent significant resources on it, but Nuance can help take things to another level.

The two companies have been collaborating closely for the past two years already, so this doesn’t come out of the blue. According to Bloomberg’s analysts, a potential space where we could see things accelerate from this business move would be “telehealth,” where Nuance’s transcription product is currently being used in combination with Microsoft Teams.

And as we move farther into the future, Microsoft would generally seek to develop applications capable of understanding human speech, translating it, recognizing images, and making correlations between the various data forms. All of that would create amazing potential in the company’s effort to deepen its consumer offerings and provide next-gen solutions in a space that is still on its formation cradle.

In other news concerning Microsoft’s acquisition plans, there have been rumors about a $10 billion deal to buy Discord, the popular VoIP, instant messaging, and digital distribution platform. There have been no updates on that story yet, as the negotiations continue privately, but people familiar with the matter claim that we should have a result by the end of the month.

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