Microsoft gets nod from ACCC on Nuance acquisition

The Australian Competition and Consumer Commission has announced it will not oppose Microsoft’s acquisition of speech recognition and transcription software vendor Nuance announced earlier this year.

ACCC commissioner Stephen Ridgeway said the two companies do not directly compete in healthcare transcription software since Microsoft does not already provide the same offerings.

“Microsoft does not currently provide this specialised technology, and it appears unlikely to become a strong competitor to Nuance,” Ridgeway said. “This transaction is therefore unlikely to substantially lessen competition in the healthcare transcription market.”

Microsoft announced in April this year that it was paying US$19.7 billion to acquire Nuance, a specialist in speech recognition and transcription software and customer engagement software. It was the company’s second largest acquisition at the time after buying LinkedIn in 2016 for US$26.2 billion.

The ACCC said its investigation found that healthcare transcription products are not currently widely used in Australia but Nuance does face competition from other vendors and could also end up competing with other large tech firms looking to expand in healthcare.

“We found that there is strong existing competition in customer engagement solutions. There are multiple comparable alternatives to Nuance, and barriers to entry are not high,” Ridgeway added.

The regulator said the deal would not enable Microsoft to prevent Nuance or Microsoft’s rivals from competing effectively.

“Microsoft supplies software in customer relationship management, productivity, video conferencing and cloud computing that are compatible with Nuance’s products. However, if Microsoft attempted to limit the access of Nuance’s competitors to Microsoft products, they could easily switch to alternative suppliers or reach customers in other ways,” Ridgeway said.

“At the same time, Microsoft would not have any incentive to limit its competitors’ access to Nuance’s medical transcription software, because the medical transcription market is very small in comparison to the key markets that Microsoft competes in.

“The ACCC will continue to pay very close attention to acquisitions by major technology companies. There has been a pattern of buying out potential competition threats which the ACCC has expressed concerns about recently, but this transaction is not one of concern to the ACCC.”Got a news tip for our journalists? Share it with us anonymously here.

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