EU antitrust regulator asks rivals to submit concerns over Microsoft-Nuance deal, report

Watchdog has sent a questionnaire to customers and competitors seeking their views

EU antitrust regulator is seeking inputs on Microsoft's proposed $19 billion (£13.7 billion) acquisition of transcription technology company Nuance Communications and has asked their customers and rivals to submit concerns over the deal.

Reuters claims to have seen a questionnaire issued last month to customers and competitors, in which the European antitrust authority asked whether Microsoft and Nuance are rival firms and how a merger would affect them.

The regulator is specifically interested to know about any possibility that Microsoft will favour Nuance over competing services after the deal is completed.

Steven Weber, a University of California Berkeley professor studying the use of technology in health care, told Reuters that a possible concern about the proposed acquisition could include Microsoft forcing its Office suite on Nuance customers by bundling them together.

A person familiar with the matter told the news outlet that the EU authority's review of the deal is most extensive by any antitrust regulator since both companies announced the agreement in April.

Microsoft won approval for the takeover from US regulators in June this year, while the Australian Competition Commission said in October that it would not challenge the deal.

Last month, both companies filed for approval from the European Commission's competition bureau, following which the regulator set a provisional deadline of 21 December to issue a decision. The EU regulator could either clear the deal or open a bigger investigation.

In April, both firms predicted that the transaction would close by the end of 2021.

Based in Burlington, near Boston, Massachusetts, Nuance is a long-standing vendor of prominent in the type of voice recognition technology, with many users in business and the health sector.

Nuance's conversational AI tools are well-versed in specialised medical terms and can accurately capture and document conversations between physicians and patients.

More than 77 per cent of the hospitals in the US use Nuance products including the Dragon Ambient eXperience, Dragon Medical One, and PowerScribe One. They all are SaaS offerings built on Microsoft Azure.

Nuance's Dragon software, which uses deep learning to transcribe speech, can adapt to a particular user's voice to improve accuracy.

Nuance's speech recognition software is also used by Apple's Siri voice assistant as well as several mobile operators including Verizon, Deutsche Telekom and Telefonica.

Microsoft expects the deal to help establish it as a major player in healthcare technology by bridging the gap between clinicians and Microsoft Cloud for Healthcare. Microsoft launched Cloud for Healthcare last year, with the service including healthcare-specific versions of Microsoft 365, Dynamics 365, Azure and Power Platform.

Analysts expect the deal to also bring new voice and medical data for Microsoft to train its AI offerings in speech, health and biometric security.

If completed, the Nuance acquisition would be Microsoft's second largest under CEO Satya Nadella.

In 2014, Microsoft acquired the Mojang AB, the owner of the Minecraft videogame, within months of Nadella becoming the chief of the company. Two years later, the company spent about $26 billion (£18.8 billion) to acquire professional network LinkedIn Corp.

In 2018, Microsoft acquired code-collaboration site GitHub for $7.5 billion (£5.43 billion).

Last year, Microsoft also made efforts to acquire the US business of Chinese social media app firm TikTok for about $30 billion (£21.7 billion) before talks fell apart.