Microsoft announced that it will acquire speech recognition giant Nuance at a price of $56 per share, with a transaction value of $19.7 billion.

Nuance is best known for its Dragon software, which uses deep learning to transcribe speech and improves its accuracy over time by adapting to the user's voice. Nuance has licensed this technology to many services and applications, including the most famous Apple digital assistant Siri.

The US$19.7 billion acquisition of Nuance is the second largest acquisition in Microsoft’s history, second only to the US$26 billion acquisition of LinkedIn in 2016. This is at a time when voice technology is rapidly improving, thanks to the craze for deep learning of artificial intelligence, and at the same time there are more opportunities for use.

In a range of occasions, from medical consultations to board meetings and university lectures, digital transcription has become more reliable. The increase in remote work has also created new opportunities. Since many meetings are conducted via video, it has become easier to provide customers with transcription services through software directly integrated into these phones.

For Microsoft, about two-thirds of its revenue comes from enterprise software sales and cloud computing, and it makes perfect sense to improve its transcription services for such scenarios. Microsoft can integrate Nuance's technology into its existing software, such as Teams, or provide it independently as part of the Azure cloud business.

Microsoft released a new mixed reality collaboration platform Microsoft Mesh-based on Microsoft Azure, anyone can build immersive, multi-user, cross-platform mixed reality applications.

However, the immediate focus will be on the medical and health sector, where the two companies have cooperated in the past. In 2019, they announced the establishment of a "strategic partnership" to use Nuance's software to digitize health records for Microsoft customers. According to reports, Nuance's health technology, including its Longyi No. 1 platform, has been adjusted to identify medical terms, used by more than 500,000 doctors worldwide, and used in 77% of US hospitals.

The news of the acquisition of Nuance was first reported by Bloomberg last weekend and is the latest example of Microsoft's massive purchase. In September 2020, Microsoft acquired ZeniMax Media, the parent company of game developer Bethesda Softwork (Company B), for US$7.5 billion. This helped Microsoft acquire the IP of classic games such as "The Elder Scrolls" and "Fallout". With half of the global RPG game market, Microsoft's Xbox game content library has also ushered in an important reinforcement. In June 2019, for the same US$7.5 billion, Microsoft took the world's largest developer community GitHub into the arms and guided 24 million developers to the Microsoft development environment.

According to Nuance, the net profit for the fourth quarter of 2020 was 7 million U.S. dollars, and revenue was approximately 346 million U.S. dollars. Revenue fell by 4% year-on-year. Nuance was founded in 1992 and has 7,100 employees as of September.