With a nearly $20 billion acquisition of speech recognition company Nuance Communications, Microsoft aims to get a leg up in its healthcare competition with other tech giants, according to an April 13 Wall Street Journal report.
Seven details:
1. Microsoft announced its plans to buy Nuance April 12 for $19.7 billion to support expansion of its healthcare offerings for its cloud products. Nuance has integrations with EHR vendors Epic and Cerner, among others.
2. The acquisition will help Microsoft break into Nuance's business selling its software to hospitals and health systems, analysts and healthcare executives told the Journal. Nuance's speech recognition software lets clinicians document patient notes by voice dictation rather than typing and clicking in the EHR.
3. Microsoft, Amazon, Apple and Google are targeting the healthcare market in different ways, playing to their separate strengths, Glen Tullman, CEO of health startup Transcarent, told the Journal.
4. Microsoft's Nuance deal shows that it's focused on selling enterprise software to healthcare providers, while Amazon has jumped into e-commerce via its $1 billion acquisition of pharmacy startup PillPack and its plans to expand its telehealth services nationwide, according to the report.
5. Apple's healthcare strategy lies with selling its devices to providers and offering mobile apps that track heart rhythms and exercise activity through the iPhone or Apple Watch. The company also offers a Health Records app that lets users download their EHRs from physicians or hospitals directly to their device.
6. Google is also involved with wearables, recently completing its $2.1 billion acquisition of Fitbit. The company is also working with Ascension and Beth Israel Deaconess Medical Center to pilot its EHR search tool and on April 12 confirmed its plans to develop a consumer-facing medical records app.
7. Microsoft CEO Satya Nadella told CNBC April 12 that he predicts the industry will see "real structural change" coming out of the pandemic due to the "massive acceleration of digital transformation."
"We have participated in it as Microsoft on the IT side, but what Nuance and [CEO] Mark [Benjamin] and team have done is take that most critical part, which is at the point of care, and really transform it with integrations, with Epic, Cerner and all the critical EHRs," Mr. Nadella said. "And so to us, it'll double our total addressable market as Microsoft going forward. Not only will we be able to serve all the providers with everything we do in Microsoft 365, Dynamics 365, Azure, but Nuance will be able to still help us deliver these AI-first solutions for doctors and radiologists and overall clinical decision support in partnership with the rest of the ecosystem."