For those confused, this acquisition is due in large part by Nuance's dominance in healthcare related products. From Nuance's last earnings release[1]:<p>“We are very pleased with the strong start to the fiscal year, as we delivered revenue and EPS above our guidance range expectations,” said Mark Benjamin, Chief Executive Officer at Nuance. “We continued to advance our strategic initiatives, accelerating our cloud transition across our core platforms in Healthcare and focusing on our AI-first approach in Enterprise. In Healthcare, we saw solid performance in our cloud-based offerings, growing cloud revenue 28% year-over-year. In particular, we benefited from strong performance in Dragon Medical & DAX Cloud revenue, which grew 22% year-over-year driven by the ongoing transition of our installed base to Dragon Medical One, as well as traction in international, ambulatory and community hospital markets. Enterprise delivered another record revenue quarter, up slightly from its previous record in Q1'20, driven by particularly strong demand for our Security & Biometrics solutions."<p>Nuance has deep relationships built with nearly every health system in the US and beyond. This fits quite well with Microsoft's corporate focus. Yes, Nuance also has a lot of IP, but I wouldn't expect any consumer facing changes (e.g. Cortana) in the near term.<p>[1] <a href="https://investors.nuance.com/download/EX%2099.1%20Press%20Release%20December%2031,%202020_FINAL.pdf" rel="nofollow">https://investors.nuance.com/download/EX%2099.1%20Press%20Re...</a>
I think a lot of big acquisitions make "sense," given the current market.<p>The most successful companies have lots of cash, high share prices, and amazing cash cows. They <i>could</i> borrow for (almost) free, so resources are practically unlimited. Their R&D is already well funded. Most of their big, growth oriented endeavours are not cash-constrained. There are usually no factories to build or production to scale up.<p>Google tried "20% time." They tried "let many flowers grow." Those things seemed ambitious at 2007-scale. In 2021 terms... new flowers need to be S&P 500 companies to represent growth, instead of just clutter. "Meaningful growth," for Alphabet, is a big number.<p>How else does a MSFT, Google or (especially) FB put $20bn to work? Acquiring "just works."<p>Of course, there are in-house alternatives. Waymo is an in-house investment by Alphabet that's bigger than this Nuance acquisition... especially if you consider the $bns Waymo will continue to need until some unknown future date. Self driving is looking more hopeful (certainly to investors) than it was when waymo started.... but waymo is still a dubious investment.<p>Consider that Google could have bought any car company, for about as much as waymo will cost eventually. Car companies have loans, so you could quibble the math... but details.<p>Acquiring is easy. The path of least resistance wins >50% of the time. We have that dynamic here, both in the human/managers sense and in the arbitrage-like incentives in the market currently.
Is it just me or have speech recognition platforms like Siri actually gone backwards in the last few years (roughly coinciding with the AI/ML craze)?<p>It feels (anecdata) that Siri is doing a bit better on voice to tex when sending messages but much worse on simple commands like “turn off living room lights”.
>Microsoft tried to buy TikTok's U.S. operations last year in a deal reportedly valued between $10 billion to $30 billion.<p>>Reports suggest it's in advanced talks with gaming chat app Discord for a deal worth more than $10 billion.<p>>A report in February suggested Microsoft was eyeing a takeover of Pinterest, worth $53 billion on the public market. Last September, it bought gaming giant ZeniMax Media for $7.5 billion.<p>Microsoft is in full yolo mode since all other big tech companies have antitrust lawsuit against them. Microsoft spent its time on the cross in the 1990s and early 2000s now they will acquire anything they can.
This is really, really unfortunate. One of the last on-device speech companies is being bought out and moved into Microsoft's cloud division. Expect nobody to be willing to sell you speech recognition without a cloud subscription now.
Several years ago I used a Nuance product named Dragon NaturallySpeaking that had speech-to-text capability and adds verbal accessibility features on Windows platforms (eg, say "Open Word", speak your document aloud, then "Close Word")<p>I had no idea they had enough sales to justify a $20 billion valuation. Though to be fair, Microsoft tends to acquire companies at high price tags (eg, Skype, LinkedIn, Minecraft) compared to eg, Apple's acquisition strategy of smaller technology focused companies (other than Beats headphones) like P.A. Semi and PrimeSense.<p>EDIT: Other comments say Nuance's patent portfolio may greatly contribute to its valuation.
So Microsoft can see your private repositories, your documents if you use Office, your personal files (one drive), your company communication (teams), now they will be able to listen what you talk about.
Where is this going?
Should we trust this company so much?
I think companies like this should be split up.
This is a duplicate of <a href="https://news.ycombinator.com/item?id=26774367" rel="nofollow">https://news.ycombinator.com/item?id=26774367</a><p>Note: everyone is getting this acquisition wrong. It's not about Dragon and their Speech-to-Tex. This is all about owning an enterprise Communication Platform (e.g. Contact Center, etc).<p>I'll repost my previous comment from the other HN thread below:<p>----<p>Everyone is wanting to take on Twilio.
Last September, Microsoft first announced their Communication Cloud.<p>A huge focus at Twilio now is moving upstream to the Call Center, where Nuance is a significant player. So Microsoft picking up Nuance makes sense.<p>It’s clear Microsoft sees communication services as a strategic core part of their business.<p>(Even at the consumer / gamer level with the rumored Discord acquisition talks)<p><a href="https://techcrunch.com/2020/09/22/microsoft-challenges-twilio-with-the-launch-of-azure-communication-services/amp/" rel="nofollow">https://techcrunch.com/2020/09/22/microsoft-challenges-twili...</a>
I am surprised at the amount of mention Dragon is getting here. It has been a long, and at times tragic road. I worked at a company that used Dragon's technology in a voice control product for the original Macintosh. Mostly, I worked on a Windows version for a multimedia architecture Intel was developing, which entailed the acquisition of Spectron for a DSP OS.<p>I got to meet a lot of the people involved at other companies in the project, including the Jim and Janet Baker, who founded Dragon, and many people at Intel up to and including Andy Grove. It was remarkable that he took interest in what was a relatively small project that was also distant from Intel's core products. I also met Jo Lernout, the L in L&H, which played a role in subsequent tragic events for the Bakers.<p>All those people, and most of the technologies from those days, are gone now. Dragon ended up a part of Nuance, which itself had been called ScanSoft, and, before that, was a part of Xerox that, if I recall correctly, was acquired by Xerox from Ray Kurzweil.<p>ScanSoft became a roll-up of a large number of speech technology companies. One of them was Nuance, and the roll-up was rebranded Nuance. Another acquisition was L&H, which had collapsed due to a financial scandal, which blew up after L&H had acquired Dragon. The Bakers got screwed and sued Goldman, who did the L&H deal. They lost.<p>And that is your capsule history of Nuance. Sorry to give short shrift to the acquired companies I have no firsthand knowledge of.<p>I believe the real story of Microsoft buying Nuance is that Nuance owns an enormous number of patents.
Oh this is big, Nuance is not very well known to the public but they are indeed very big in speech recognition. We used their solution with automated support systems.
Speech recognition in consumer electronics continues to be slow, unreliable, and a privacy nightmare. I can't tell you the last time I saw someone use it seriously. There are reasonable applications for it, but they are few and far between. I wonder what makes it worth $20B to MS.<p>Top comment as I'm writing this says Nuance has a strong presence in the healthcare device market, but I'd be surprised if that alone was worth the purchase price.
What does Microsoft get out of this? They already have TTS and deep learning transcription, what technical capabilities does Nuance have that they don't have already (or can't develop for substantially less than $20B?)
I'm not super deep into the world to NLP, but from what I have kept up with, it seems that the state-of-the-art is almost constantly open-sourced. I understand certain companies have personal relationships already built which may be what MS is after more so than the IP, but isn't there a "canonical" way of building a, for example, speech to text system for your phone?<p>Is there really a lot of NLP IP hidden behind corporate walls at this point? I just assumed Alexa, Siri, Google Assistant, etc were all using the same model architectures. Genuine question, can anyone shed some light?
a little over a decade ago i contracted for nuance working on a speech-to-text project for cell phone voicemail, either att or verizon. the job was literally listening to actual customers' voicemails and transcribing them (or correcting auto-transcriptions) into the system. literally 6 to 8 hour shifts of pure mind numbing work. we were told nothing about the tech behind it but I wonder if any of that work compounded into some of their in-use tech today, or if it was all just throw away.<p>pointless story aside, their enterprise valuation at the time was a little under 20% of what it is today, and the company remained mostly the same until 2 years ago. wonder what the catalyst was for their 5x valuation growth?
This is incredible for a company like Nuance.<p>At the time of acquisition:<p>Nuance: $20B, employee strength 6000. 3M/employee<p>LinkedIn: 26B, employee strength ~12000. 2M/employee<p>LinkedIn was much more larger, more 'visible' and perhaps better talent attractor than Nuance at the time of acquisition.
I interviewed there about 10 years ago. An interviewer actually asked me "how will you deal with constantly going to pointless meetings and politics ruining any hope of actually getting anything meaningful done here?" Lol.
Whenever I think of Dragon I always remember the early versions (90s?) I used to have to use that required 1 or 2 hours of speech training.<p>It felt weird reading 'Moby Dick' to a computer for an hour , but at the time there was no product that could even get near Dragon in any performance metric.<p>Since natural language interpretation is such a widely used concept now I had taken it for granted that Dragon even existed anymore.<p>I don't know much about the company, and I don't know much about the product anymore, but that kind of persistence and consistency in this field is admirable.
$NUAN's spike from $45 on Friday makes sense. However, I'm having trouble figuring out why they currently trade at ~$53 given that the market knows that Microsoft will pay $56 for each share. (<a href="https://news.microsoft.com/2021/04/12/microsoft-accelerates-industry-cloud-strategy-for-healthcare-with-the-acquisition-of-nuance/" rel="nofollow">https://news.microsoft.com/2021/04/12/microsoft-accelerates-...</a>)<p>Any ideas on why that is?
I knew Nuance sounded very familiar, but when I googled it, the news were about an AI company, which confused me.<p>DragonDictate / Dragon NaturallySpeaking, that's why it sounded so familiar.
One thing I considered doing long ago was creating middleware to use NaturallySpeaking via an API and noticed in their license agreement they have the following:<p><pre><code> A license for the Software
Package does not allow Licensee to use the Software
Package on a
server.
</code></pre>
I'm curious how well this would hold up in a court. I only mention this because Nuance is a pretty litigious organization. I imagine they were bought pretty much for the patents.
What will this mean for Apple? Aside for Siri, Nuance voice is used for the Mac TTS engine, which I use quite heavily.<p>In English, there are quite a few contenders for TTS, eg. Amazon. Apple can find another vendor. But in some languages it is Google voice or Nuance and there are no other games in town.
Can I just say here that these all-cash transactions really suck?<p>Here you have been carefully exercising your stock options every month so you can pay only long-term capital gains taxes, and avoid AMT, and then BAM! sorry, you just sold it all at once. "BZZZT. Sucker."
Am I the only doc who despises Nuance? Dragon is definitely Microsoft-style software: lots of exposed features with defaults randomly set to "what no one would want, ever". Nevermind the core algorithm never really seemed to work well for me.
For those wondering some of Nuance strengths in speech:
Multiple award winning
Very domain oriented and not just general speech
Supports many languages<p>They have also had a boost in stock with covid and more people using remote speech services
What does an all cash deal of $20bn look like? I'm assuming it's really just an ACH transaction or something? There's not a convoy of armored cars with silver briefcases or anything... Is there?
After having tried Microsoft's automatic captioning on Microsoft Stream which is akin in accuracy to monkeys typing something random on a typewriter, I think this seems like a good choice.
I am confused how speech recognition tech is worth 20 billion. It’s not even on the most popular platforms like iPhone, android or the desktops even. Can someone shed some light on this?
> The Burlington, Massachusetts-based company, for example, powered the speech recognition engine behind Apple's voice assistant, Siri.<p>That is the last speech recognition engine I would ever want to buy.
Plenty of blind people would get behind this if it happened. <a href="https://t.co/vQIch9PLiW" rel="nofollow">https://t.co/vQIch9PLiW</a>
The skype thing was a clusterfuck. I loved skype casts and they fucked it all. Discorde is OK now, but dam does it make me feel old. I join a server and join a VC and here a bunch of 13 year olds. I have to leave because I am 38 and it's creepy to be talking to 13 14 yearolds on the internets at my age lol I made a server for tech nerds and people who like OpenWrt. <a href="https://discord.gg/KuNhWzvp5S" rel="nofollow">https://discord.gg/KuNhWzvp5S</a>.