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Microsoft Acquisition of Nuance is a Massive Deal in Voice Recognition  – AI Tendencies



With its acquisition of Nuance, Microsoft additionally beneficial properties a variety of voice know-how patents it will possibly use to increase into healthcare and different strategic markets. (Credit score: Getty Photographs) 

By John P. Desmond, AI Tendencies Editor  

Microsoft final week introduced the acquisition of Nuance, provider of voice recognition software program, for the equal of $19.7 billion, making it the second-largest acquisition in Microsoft’s historical past after the $26 billion deal for LinkedIn in 2019. 

Nuance is finest identified for its Dragon software program, which makes use of deep studying to transcribe speech and improves its accuracy over time by adapting to a person’s voice, based on an account in TheVerge 

Voice recognition know-how is getting higher together with advances in AI, offering extra alternatives in enterprise and cloud computing. Microsoft makes roughly two-thirds of its income from enterprise software program gross sales and cloud computing,  

Nuance has licensed its voice know-how for a lot of companies and functions, together with for Apple’s digital assistant Siri, in accordance to an account on Siri in Wikipedia. It’s unclear to what diploma Siri presently depends on Dragon software program for voice recognition.  

PC-Primarily based Voice Recognition   

Dragon Methods, launched in 1982, was an business chief in voice recognition. It launched Dragon NaturallySpeaking in June 1997, shortly attaining a lead over IBM and Microsoft in voice recognition software program operating on microprocessor (PC) platforms. Dragon was acquired in 2000 by Lernout & Hauspie, which subsequently was charged with fraud and needed to declare chapter. Nuance, then named ScanSoft, acquired the software program property of L&H for $39.5 million in November 2001. James and Janet Baker, the founders of Dragon Methods and creators of its voice recognition software program, agreed to promote the corporate to L&H in a half money/half inventory deal for $580 million. Shortly earlier than closing, the deal acquired transformed to an all inventory deal  which on the precise time limit, had declined to $460 million in worth. After the chapter submitting, all of the Bakers inventory grew to become nugatory. The Bakers subsequently made very minor recoveries for his or her voice recognition software program, and have been largely unsuccessful in gaining additional recoveries by the courts.  

The 2 firms had been working collectively, with Nuance constructing a number of merchandise atop Microsoft’s Azure cloud, and Microsoft utilizing Nuance’s Dragon service inside its Cloud for Healthcare resolution that launched final yr, based on an account in VentureBeat 

Satya Nadella, CEO of Microsoft

“Nuance offers the AI layer on the healthcare level of supply and is a pioneer within the real-world software of enterprise AI,” acknowledged Satya Nadella, CEO of Microsoft, in a press launch. “AI is know-how’s most necessary precedence, and healthcare is its most pressing software. Collectively, with our companion ecosystem, we’ll put superior AI options into the arms of execs in all places to drive higher decision-making and create extra significant connections, as we speed up development of Microsoft Cloud for Healthcare and Nuance.” 

Mark Benjamin, CEO of Nuance, acknowledged, “Over the previous three years, Nuance has streamlined its portfolio to give attention to the healthcare and enterprise AI segments, the place there was accelerated demand for superior conversational AI and ambient options. To grab this chance, we’d like the correct platform… The trail ahead is clearly with Microsoft.”  

Merchandise from Nuance are presently utilized by greater than 55% of physicians, 75% of radiologists and in 77% of U.S. hospitals, based on Microsoft. Nuance’s Healthcare Cloud income skilled 37% year-over-year development in Nuance’s fiscal yr 2020 (ended September 2020). 

Nuance has a collection of AI merchandise tailor-made for medical settings, together with a digital assistant for digital well being information, a multi-party dialog transcription service, and a deep studying language mannequin that converts medical conversations into structured notes for integration into well being information, based on the VentureBeat account. 

Healthcare staff are additionally utilizing Microsoft merchandise reminiscent of Outlook, Groups, Workplace and messaging apps. Now Microsoft is in a superb place to combine these with medical functions and information engineering that allows machine studying fashions and information analytics instruments to span a variety of knowledge sources.   

Acquisition Speaks to Microsoft’s AI Technique 

Commenting on Microsoft’s AI technique, the writer of the VentureBeat account, Ben Dickson, a software program engineer and the founding father of the TechTalks weblog, acknowledged, “Microsoft advanced from being Nuance’s cloud supplier to its companion to its proprietor. And this evolution tells us quite a bit about Microsoft’s AI technique, which I believe could be very good, given how briskly issues can change within the AI business. The enterprise AI sector has come a great distance towards creating functions that may clear up real-world issues. However we nonetheless haven’t discovered many issues. And as new applied sciences and firms proceed to develop, Microsoft shall be watching and selecting winners.” 

Janet Baker, cofounder of Dragon Methods in 1982, commented in an account in the Boston Globe, “We wished to seek out an audacious aim that was attention-grabbing, and multidisciplinary, and one thing we might obtain in our lifetimes. And if we did, it could have a constructive affect on society.”  

Nuance, which at the moment has some 825 workers in Massachusetts, acquired different regional firms that included SpeechWorks, eScription, VoiceSignal Applied sciences, and Vlingo. Stu Patterson, former chief government of SpeechWorks, acknowledged that Nuance “has extra mental property round speech than anyone on earth.” 

Quite a few Nuance alumni have been employed by firms reminiscent of Google and Amazon to assist construct up their speech capabilities. For example, Jeff Adams, founding supervisor of Amazon’s Alexa crew, spent eight years at Nuance enhancing the Dragon NaturallySpeaking dictation product. 

Ron Croen shaped  the unique Nuance in 1994 with three researchers from SRI Worldwide, a nonprofit analysis and growth group headquartered in Menlo Park, Calif. SRI shaped an Synthetic Intelligence Heart in 1966 and contributed to the event of speech recognition and translation merchandise. In December 2007, SRI launched a derivative, Siri Inc., which Apple acquired in April 2010.  At the moment, Siri included Dragon-based speech recognition licensed from Nuance. The Siri voice assistant was launched by Apple on the iPhone 4S in October of 2011.  

Neither Apple nor Nuance acknowledged the licensing and incorporation of the speech recognition till then-CEO Paul Ricci of Nuance lastly did so throughout an deal with to an business convention in 2013, based on an account in appleinsider. “We’re the basic supplier of voice recognition for Apple,” he acknowledged in response to a query.  

For many years, Croen acknowledged, firms together with Microsoft and IBM have poured hundreds of thousands of {dollars} into attempting to get software program to higher acknowledge human speech. However turning these lab breakthroughs into market merchandise “has by no means been apparent to the Microsofts or the IBMs,” says Croen. “They only haven’t been good at it.” 

Vlad Sejnoha, a companion at Boston-based Glasswing Ventures, an funding agency, and a former chief know-how officer at Nuance, stated within the Boston Globe account that he sees the business’s subsequent large step as being “conversational AI,” reminiscent of chatbots, that allow interactions in a extra human-like method. A present startup his agency is funding, LifePod Options, sells good audio system that may provoke conversations somewhat than ready to be requested one thing. One software: reminding seniors a few medical appointment or a tablet they’re presupposed to take earlier than bedtime.  

Janet Baker Says Nuance Purchase “Makes a Lot of Sense” for Microsoft  

Janet Baker, cofounder of Dragon Methods, MIT Media Lab Scholar/Affiliate

Reached for remark by AI Tendencies on Microsoft’s acquisition of Nuance, Janet Baker noticed it as strategic. “This can be a very synergistic transfer for Microsoft due to the complementary applied sciences, particularly the coupling of Nuance’s commanding healthcare place with the Azure cloud service. That makes a number of sense. And it definitely reinforces Microsoft’s place throughout the enterprise area, with a lot larger margins accessible in not solely the medical market, however in authorized, finance, enterprise, authorities, and a few industrial markets as nicely. 

This acquisition additionally extends Microsoft’s attain throughout a number of platforms, from embedded units, PCs, servers, and on up, and does so in dozens of world languages. ” 

The variety of voice know-how acquisitions Nuance has made over time now offers Microsoft a stronger place. “Nuance has a superior patent place on this area with the sheer variety of patents they possess,” Baker stated.  

Dragon’s software program was licensed for Siri since earlier than Siri, Inc. was acquired by Apple, she stated. “I’ve no direct data, but when it’s been displaced, I presume it’s been lately,” she stated. “I collect they tried to displace it a number of occasions, however there have been efficiency limitations.’ 

Lots of the most skilled folks working in voice recognition at the moment, realized concerning the know-how, merchandise and methods to help prospects whereas working at Dragon after which Nuance, she stated. “We had a really holistic view of methods to develop merchandise and marketplaces that has not been usually adopted by firms, even those who have main assets,” Baker stated. “We actually tried to assist the purchasers achieve success, to hearken to their suggestions, and to present that again to engineering. Only a few firms actually try this.” 

Medical terminology, specialised vocabularies, and intuitive person interfaces have been at all times  vital targets for Dragon. For busy medical professionals who must create experiences, “It’s a lot simpler to talk it than to sort or write it. It’s rather more environment friendly,” Baker stated.  

She just isn’t bitter about not getting paid for the software program know-how. “It was a really evil factor, however we got down to clear up an enormous downside. That was our audacious aim, and we spent our lives doing it. We really feel privileged to have been a basic a part of making that occur.”  

She additionally known as consideration to the various professionals who’ve created, developed, and supported the Dragon-based applied sciences over time. “Lots of people made it occur. We led the path and that was crucial, and we pioneered a variety of technical improvements, however it could not have occurred on this scale with out the devoted, top-notch group of individuals we had engaged on it. They deserve a number of credit score.”  

Learn the supply articles and data at TheVerge, in Wikipedia, in VentureBeat, in a Microsoft press launch, within the Boston Globe and in appleinsider.   

[Editor’s note: Thank you to Janet Baker for citing some history and references for this article. She noted a key reference to Dragon’s debacle with its sale to L&H, that company’s subsequent bankruptcy and how the Bakers tried to recover what they were owed in this New York Times article.]  

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