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EU clears Microsoft's $19.7 billion purchase of Nuance (updated)

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Microsoft logo (Image credit: Daniel Rubino / Windows Central)

Updated December 21, 2021 at 11:04 AM: The EU has granted approval of Microsoft's purchase of Nuance (via Reuters). The original story follows.

What you need to know

  • Microsoft announced a $19.7 billion purchase of Nuance in April of this year.
  • The EU will grant unconditional approval of the deal, according to a recent report.
  • The United States and Australia have already approved Microsoft's purchase of Nuance.

Microsoft's $19.7 billion purchase of Nuance is set to clear yet another regulatory hurdle, according to a recent report. Reuters states that the European Union (EU) will grant unconditional approval for the deal. This would be a major step toward finalizing the deal, which has already been approved by the United States and Australia.

Nuance specializes in artificial intelligence (AI) and speech recognition. General consumers are likely familiar with the company's Dragon speech recognition software. Nuance also helped create Apple's digital assistant Siri. Speech tech from Nuance is used regularly in the medical industry as well. 77% of hospitals in the United States use Nuance tech, according to the company.

The $19.7 billion purchase of Nuance is Microsoft's second-largest deal to date, only falling short of the $26.2 billion acquisition of LinkedIn in 2016.

Microsoft and Nuance filed for approval from the European Commission's competition bureau in November 2021. That body has until December 2021 to approve the deal or open a more in-depth investigation. Both the European Commission and Microsoft declined to comment to Reuters.

While the EU will reportedly approve the deal, the acquisition also has to be cleared by the UK's antitrust agency. Microsoft is said to be in talks with this body.

The United States and Australia have already approved Microsoft's purchase of Nuance.

A portion of Microsoft's purchase — a little over $3 billion of it — covers Nuance's debts, which brings the total value to $19.7 billion.

Sean Endicott
News Writer and apps editor

Sean Endicott brings nearly a decade of experience covering Microsoft and Windows news to Windows Central. He joined our team in 2017 as an app reviewer and now heads up our day-to-day news coverage. If you have a news tip or an app to review, hit him up at sean.endicott@futurenet.com (opens in new tab).

16 Comments
  • I bet this is to make cortana better for her big consumer product return when they put out there consumer version of AR Glasses in 2024.
  • Cortana is on a round the world cruise snd won't be back any time soon.
    This is all about using Nuance's BIG presence in the medical industry as an entry point for Azure.
  • Thank goodness for that, but it is still running in the background of Windows 11 for some strange reason
  • Probably more of a Clippy return since they've been cheekily mentioning it a lot more recently on their socials and even in Windows emoji for nostalgia. Though I still like the Cortana brand with it's ties to Halo and relevancy to the features, as I'm sure many others do. It's just the app itself was so limited and their marketing was horrible. If they do invest in it again, I hope they allow allow 'switchable characters' like Clippy used to have so that users can have a choice to use Cortana, Clippy, or any of the other nostaglic characters like Rocky, Merlin and Links. And it would be an awesome way for them to make money by allowing sponsored characters. It would bring that level of fun and quirkiness they used to have that is sorely missing, while also bringing more users which would give them more reason to invest in it. But I doubt it'll happen, seems like Assistants in general have low usage but I could be wrong. But I work in IT and don't know many people actively using Siri or Google Assistant or Bixby.
  • Healthcare is a big deal. Consumer AI assistants are not. Without knowing any details, my guess this is about enterprise AI.
  • Consumer AI "assistant" voice controls are an enabling technology for IOT gadgets. Hardware. A big deal to an operation like LAB126. Look at the proliferation of products they've enabled, both for Amazon and others. Once it became clear that real world users don't rely of voice controls on computers and consoles (yet, maybe never) MS pivoted to other types of usability improvements. Especially on consoles which is their consumer space hardware product. (Although gamepass can be considered a form of usability product. 😇) Note that Apple hasn't done much with Siri for years because their home gadgetry play hasn't gotten very far. (Or maybe their gadgetry play hasn't gotten far because of Siri.) ALEXA has gotten as far as they have because Amazon, to their credit, were thinking of cpnsumer gadgetry from day one. It's their kind of high volume low margin product space. In fact, most ALEXA products add value for Amazon by growing the gadget ecosystem, not through license fees. A very different business model than MS, Apple, or even Google are used to. MS isn't killing Cortana because the tech may yet mature as an adjunct to AR but for now its on vacation, backburnered. Future TBD.
  • i thought Nuance had vanished years ago.
  • Natural language *consumer" software plateaued but they found an enormous market where the underlying tech is invaluable in dealing with mountains of information. The tech (and staff) is US$19B valuablr but the company itself was barely making money. Both Nuance and MS recognized the tech makes more sense as a feature (of AZURE and OFFICE) than as a product. MS is treating cloud gaming similarly. In fact, it is becoming their primary business model for their services businesses.
    The Nadella regime is riding that horse as long as it drives growth and right now there is no end in sight.
    They're buying companies left and right but most if not all with strategic purposes, because it is the fastest way to boost their services businesses.
  • Buying companies left right and centre is the problem, a large company getting larger and having more of a monopoly, I am surprised that the E.U have agreed to it, makes me wonder what have gone on behind the scenes.
    I have not used Dragon speaking for years, I have an old copy of it somewhere, but to be honest speaking to your computer is a gimmick and using a keyboard and mouse is much easier. I can understand speaking to a computer is fine if you have limited movement In your hands and yes I realise that we speak to computers using digital assistants like Alexa and Google Assistant, but they are not always reliable.
  • Are you suggesting it should be illegal to be competent and successful? First, Look up the definition of monopoly.
    MS isn't it and never has been one. Second, both MS and Nuance are American companies and Nuance in particular mostly plays of this side of the pond. Try as they might, the Brusselcrats found no significant EU competidor that might be harmed. Remind me again, who over tbere competes with AWS and AZURE? Who is applying AI to digitizing medical records and hosting them online? Who there has spent over a decade building a reliable cloud computing business? Try this: https://www.youtube.com/watch?v=zSU5MFPn6Zk Europe has only themselves to blame if they killed their big tech companies and keep driving their best and brightest entrepreneurs to seek support (instead of roadblocks) elsewhere.
  • Without knowing the details of the deal, I have to say I'm pleasantly surprised that this went though so easily. The EU has a deserved reputation for sinking deals and prosecuting big companies based on bad antitrust logic (a model which unfortunately the US is moving towards). Maybe this is a good sign.
  • Their MO ill serves them on these mergers because it is focused on market share consolidation.
    MS is buying Nuance precisely because they had minimal share of Nuance's market; they are looking to compete in it by buying Nuance's share. As far as their limited "relevant market" mindset is concerned, the only thing changinb is the name of the company holding that market share.
    Very backwards looking like their entire "competitor focused" antitrust theory.
    The merger *is* a gamble for MS, it might fail to boost AZURE in the medical space,but the tech itself has other uses and MS can afford it. It is good use of their cash stash.
  • This will not make cortana to make a comeback but they should start thinking of maybe delivering what the competition does? Fells like Microsoft slowly dies behind Google and soon Amazon.
    They offer almost the same thing for casual Users and more and Microsoft focusing on companies but why stick to windows when android expend fast and what if they start focus more on work ( enterprise ) what will Microsoft do then?
  • I too wish MS did more for consumers (beyond Xbox, of course), but they are dominant in Enterprise because they offer incredible solutions for enterprise. It's not like it's just inertia keeping them there. No one really offers anything that is even in the same ballpark as MS' products for the workplace. Teams, Office, Azure AD, PowerAutomate, Power BI, Exchange... just to list a few. and they all work mostly beautifully together. The competition has, at best, less capable me-too versions of a subset of the MS suite. It's like MS is selling a car, and everyone else just offers lower quality seats, radios, and steering wheels.
  • Have you actually looked at the MS growth rate? At their valuation trends?
    They're not dying. They are healthy, growing, and flexing their muscle in the fastest growing big bucks businesses, instead of nickle and dime me2 gadget markets. They are moving forward to great effect by focusing on the areas *they* can best serve instead of what their competitors (most of which are one or two trick ponies) do well. And, as the bank thief said: "It's where the money is." Medical is a big bucks, growing space. A very good place to make money selling services so the companies can focus on what *they* do best. A win-win. MS is a diversified company with multiple products and servicrs, each of which is bigger and more profitable than entire companies. They are focusing where they can bring in big money, not scfambling for pennies where other companies play. The Nuance move is in the same vein as the Zenimax buy and buying a horde of small security specialist outfits: adding value to the big rainmakers in their portfolio. AXURE, OFFICE, GAMEPASS. All growing steadily and bringing in big bucks. Very strategic
    Very sneaky, too.
    All under the radar of the IdiotPoliticians™.
  • Great points. As usual for fjtorres. :-)