Microsoft, a tech giant, announced on Monday that it is buying speech recognition pioneer Nuance Communications. The price is $19.6 billion. The second-largest deal for the company since LinkedIn in 2016. It cost the company $26 billion. Artificial intelligence technology greatly assists doctors in predicting patient’s needs and upgrading hospitals’ digital record keeping. Microsoft is offering 56$ per share to Nuance.
Microsoft, Google, Amazon, and even Apple (AAPL) have been working on health care projects over the course of many years. Nevertheless, the coronavirus pandemic further accelerated the process as it sparked a great demand for improved video conferencing capabilities. The aim is to improve electronic health records (EHR) access for patients.
In November, Microsoft is planning to launch a Cloud for Healthcare service that it has been building. According to Microsoft, Nuance will double its addressable market in the health care space, which will bring $500 billion to its TAM. Nuance has a global reach. Therefore Microsoft will get a significant advantage in the healthcare industry. More than 55% of physicians and 75% of radiologists in the U.S., and 77 % of U.S. hospitals use artificial intelligence software.
Many other companies other than Microsoft are looking for opportunities in the health care sector. The health care industry is worth nearly 4 trillion dollars. It is becoming the next battlefield for big tech companies. Amazon is the world’s largest cloud provider that is ahead of Microsoft and Google. It uses its cloud capabilities to reach doctors and patients via the Amazon Web Service platform Health and Life Sciences.
In 2018, Amazon acquired PillPack. Thanks to this move, Amazon is already working in the pharmacy space called Amazon Pharmacy. It is a service that allows consumers to order prescriptions through Amazon.
Simultaneously, Google provides similar services, like health, virtual care, and wellness apps for providers and health care analytics and insights. Alphabet, which is Google’s parent. It also oversees its life sciences company, Verily.
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