Microsoft buys Siri’s AI partner firm Nuance for $19.7B

Update (12/04/2021): Microsoft Microsoft reportedly wants to buy Siri’s AI partner firm Nuance for $16B today that it bought Nuance for $19.7 billion in an all-cash deal. The company said that this acquisition will help it bolster its AI offerings in healthcare, cloud, and office collaboration space. You can read more about the announcement here. 

Previous headline: Microsoft reportedly wants to buy Siri’s AI partner firm Nuance for $16B

New week, new Microsoft acquisition chatter. After reports of the tech giant acquiring gaming-focused communication platform Discord for more than $10 billion, rumors of it chasing speech AI company Nuance have emerged.

According to a report from Bloomberg, Microsoft wants to buy the AI firm for $16 billion. The Seattle-based tech giant is ready to pay $56 per share — that’s more than 20% higher than Nuance’s last closing of $45.22.

A CNBC report noted that Microsoft made the first approach in December, and a deal could be announced any time this week. If the deal is finalized, this will be Microsoft’s second-biggest acquisition after LinkedIn ($24 billion).

While Nuance focuses a lot on enterprise communications involving healthcare and customer engagement, its claim to fame is helping Apple make Siri better through analytics. Over the years, with the help of the AI firm, the iPhone maker has prepared the digital assistant for contextual conversations and requests.

Microsoft and Nuance have collaborated previously in projects such as helping doctors create a transcription of patient visits and recall medical records or prescribed medicine through voice commands. Plus, the AI firm’s repository of more than 3,000 patents will be attractive for Microsoft.

Microsoft’s interest in AI speech comes at an interesting time. Earlier this month, the firm removed Cortana apps — its own voice assistant — from the Apple App Store and the Google Play Store.

Given this step, there’s a slim chance the tech giant is acquiring Nuance to develop a consumer-facing digital assistant. Rather, Microsoft might want it to help develop more focused enterprise AI solutions in areas such as healthcare.