“We are very pleased with the strong start to the fiscal year, as we delivered revenue and EPS above our guidance range expectations,” said Mark Benjamin, Chief Executive Officer at Nuance. “We continued to advance our strategic initiatives, accelerating our cloud transition across our core platforms in Healthcare and focusing on our AI-first approach in Enterprise. In Healthcare, we saw solid performance in our cloud-based offerings, growing cloud revenue 28% year-over-year. In particular, we benefited from strong performance in Dragon Medical & DAX Cloud revenue, which grew 22% year-over-year driven by the ongoing transition of our installed base to Dragon Medical One, as well as traction in international, ambulatory and community hospital markets. Enterprise delivered another record revenue quarter, up slightly from its previous record in Q1'20, driven by particularly strong demand for our Security & Biometrics solutions."
Nuance has deep relationships built with nearly every health system in the US and beyond. This fits quite well with Microsoft's corporate focus. Yes, Nuance also has a lot of IP, but I wouldn't expect any consumer facing changes (e.g. Cortana) in the near term.
[1] https://investors.nuance.com/download/EX%2099.1%20Press%20Re...
Dragon has been around for 23 years and has been THE product for VR in the medical field for at least the last 10 years (from my experience).
https://www.nytimes.com/2012/07/15/business/goldman-sachs-an...
At the time, Hound actually was very very good at language recognition and impressed everyone quite a bit. Compared to Nuance, the experience of conversing with Hound was better as I remember. However, Nuance had the edge in language support... while Hound was great for Western dialects of English, and some others, Nuance supported Mandarin. End of the day it was no contest which product we had to go with.
I'm not surprised that Nuance had continued to be an industry leader all these years.
...
[0] https://cloudsolutions.comcast.com/apps/64168/office-365#!ov...
And 100% agreed, the voice is great on the Xfinity remote. Was very impressed.
The most successful companies have lots of cash, high share prices, and amazing cash cows. They could borrow for (almost) free, so resources are practically unlimited. Their R&D is already well funded. Most of their big, growth oriented endeavours are not cash-constrained. There are usually no factories to build or production to scale up.
Google tried "20% time." They tried "let many flowers grow." Those things seemed ambitious at 2007-scale. In 2021 terms... new flowers need to be S&P 500 companies to represent growth, instead of just clutter. "Meaningful growth," for Alphabet, is a big number.
How else does a MSFT, Google or (especially) FB put $20bn to work? Acquiring "just works."
Of course, there are in-house alternatives. Waymo is an in-house investment by Alphabet that's bigger than this Nuance acquisition... especially if you consider the $bns Waymo will continue to need until some unknown future date. Self driving is looking more hopeful (certainly to investors) than it was when waymo started.... but waymo is still a dubious investment.
Consider that Google could have bought any car company, for about as much as waymo will cost eventually. Car companies have loans, so you could quibble the math... but details.
Acquiring is easy. The path of least resistance wins >50% of the time. We have that dynamic here, both in the human/managers sense and in the arbitrage-like incentives in the market currently.
It does have the advantage that you can "spin off" your acquisitions once they fail to do anything interesting (though this is more commonly seen in sunset industries/dying companies (see AOL, Compaq, etc)).
I agree, but I think MSFT (and friends) are in this predicament no matter what. What's the alternative?
That said, I don't really think BRK is the end game.
For one thing, Berkshire is kind of an exception. There are plenty of smaller conglomerates that are actually like Berkshire, but most pretend not to be conglomerates. They pretend to be far more cohesive & synergetic than Berkshire.
Also, Alphabet shows that synergies can be easy to find. Youtube, Android... This generation's acquisitions need to be 10X bigger than that. But... these companies are in uncharted waters. No company has wielded free resources at the scale that MSFT now operates. They aren't the only one currently, but they don't have predecessors... unless we go back to VOC or somesuch.
OTOH... Satya is accidentally in the same position Buffet intentionally sought: Sitting on a pile of capital that must be allocated.
But overall, yes. I can think of so many large-scale acquisitions that didn't go so swimmingly.
- AOL/Time-Warner
- Ford/its stable of luxury brands like Jaguar and Land Rover
- Compaq/HP
- Daimler/Chrysler
You don’t need to hunt new customers with a marketing plan; you likely already have customers with these needs in your pipeline so it’s a matter of making sure your AEs know what’s happening. Everything is simpler at scale in a cloud business model, which is why these 3 companies in particular are eating the world.
You mean Berkshire Hathaway, that's current market cap is ~$615B and hails arguably one of the most successful investors of all time as its CEO? That Berkshire?
I don't know about you, but I'd happily be just 1/100th as successful as how that model turned out.
2/3 of those arguably are among the most important parts of their respective companies
It feels (anecdata) that Siri is doing a bit better on voice to tex when sending messages but much worse on simple commands like “turn off living room lights”.
Simple things like:
"Remind me to X tomorrow at 9am" "Add Y to the shopping list" "Remind me to do Z when I get home"
This is the only way I do reminders now and it's great. It's especially useful while driving, or when I'm in bed nearly asleep and remember something, I can just tell Siri without having to get up and use my phone.
And as far as smart home controls, being able to say "Siri, turn all the lights on" or "Siri, turn the heater on" without having to stop what I'm doing and walk around the house flicking switches is really nice.
Assistants provide a very noticeable QoL improvement for me in many aspects. I think that's more than most other products on the market can say. And that's not even touching on the lives saved from not having to use your phone while driving.
For me, speech recognition and assistants, along with software like Todoist, are able to keep me far more functional than I would be otherwise.
Salty, but I think I agree.
It seems that with AI/ML, choosing/defining your problem well is hugely important. Text to speech, even computer generated natural language is a definite enough task that engineers (and machines) have the feedback to make progress.
In fact I'd say Apple is just keeping spending money instead of shutting it down. When IBM Watson AI sank like turd in market it cut funding and let most of team go. I think Apple doing same might be more sensible.
Microsoft is making a intervention with things purchase the way I see it.
What they have to do is provide a Linux version or at least O365 interop as good with Edge for Linux as Windows.
Nuance support and products are hopeless - my subscription for $120/yr stopped working with ios14 and the app refused to send password reset emails and then we discovered that no online account management existed and cancelled instead of relying on 8/5/300 telephone queuing.
"Hey Siri, make a Facetime call to Bob Smith." "Which Bob Smith would you like to call? bobsmith@icloud.com or bobsmith@me.com?
How at this point does Siri not have even the most basic of logic to know that it's literally the same person. That's Apple's OWN service.
Usual Apple reliance on their fans buying their devices no matter how bad the software is.
I'm indeed also a bit surprised that this hasn't progressed. It's still not possible to say things like "Turn on my living room lights and the hallway as well". It still feels very scripted where you have to say things exactly the right way and in bite-sized chunks to make it work. The same with Alexa by the way.
I've noticed it's been misunderstanding my girlfriend more and more over the past few months (she has a slight accent to her English, but nothing remotely difficult to understand), and lately it's started misunderstanding simple things that I say too. For example if I have Netflix paused and say "hey google, resume", 30% of the time it will give me search results for how to write a résumé instead of unpausing Netflix. I've had the Google Home for a few years now, and that literally has never happened before now. To get it to work reliably, I have to instead say "resume playback" or "resume chromecast".
Google's online advice is whenever the assistant fails to work just retrain the device. I remain skeptical that's the issue because it's not like my way of speaking has changed. Instead I have just switched to a new way to request what I need since reporting the issue via Google's vaunted customer service process seems likely to fail.
I've used both Siri and Alexa daily for many years, and used to rag on Siri a lot. In my experience Siri has caught up to Alexa on most fronts, and I find them more or less interchangeable my common use cases (home automation, timers/alarms, music, news/weather summaries, etc.).
That's not saying much since the Alexa bar is quite low. But like many Apple products, I'd characterize Siri's improvements as "slow and steady" for almost a decade now.
It feels like it does better in edge cases at the expense of the main cases.
Siri is way more than a pure voice "assistant".
>Reports suggest it's in advanced talks with gaming chat app Discord for a deal worth more than $10 billion.
>A report in February suggested Microsoft was eyeing a takeover of Pinterest, worth $53 billion on the public market. Last September, it bought gaming giant ZeniMax Media for $7.5 billion.
Microsoft is in full yolo mode since all other big tech companies have antitrust lawsuit against them. Microsoft spent its time on the cross in the 1990s and early 2000s now they will acquire anything they can.
Microsoft's first acquisition was in 1987 of Forethought Inc. or developers of what is now Microsoft PowerPoint and they bought them for only $14m. Today PowerPoint as a product and as a brand is worth billions.
Hopefully Microsoft will eventually unify these apis and configurations into something coherent.
https://blogs.microsoft.com/ai/with-azure-percept-microsoft-...
Which is to say, the blog doesn't make it sound like I can use this without an Azure subscription, even if it works offline sometimes. Whereas the Microsoft Speech SDK, I could just include the DLL files and run with it.
https://docs.microsoft.com/en-us/azure/cognitive-services/sp...
I believe Google Cloud Platform has something similar available (not sure about AWS).
I had no idea they had enough sales to justify a $20 billion valuation. Though to be fair, Microsoft tends to acquire companies at high price tags (eg, Skype, LinkedIn, Minecraft) compared to eg, Apple's acquisition strategy of smaller technology focused companies (other than Beats headphones) like P.A. Semi and PrimeSense.
EDIT: Other comments say Nuance's patent portfolio may greatly contribute to its valuation.
They also bought up a lot of small companies and products from bigger companies and own a lot of patents.
For example, they've done all the work to get that same software certified healthcare grade and convinced lots of hospitals to adopt it for their doctors. They can sell that for a lot more than they sell the essentially same software to you.
If you go to a corporate website and see an "Industries" section with Healthcare, Telecommunications, Finance, Government, and more you know they're good at this sort of rent-seeking.
If so imagine them sales...
When Siri's ancestor was being worked on at SRI, it used a cousin of Nuance for the speech part. The PI of the virtual assistant piece of that program spun it out as a separate company, and was immediately snarfed up by Apple.
At that time, they switched speech recognition providers; but I don't know if Apple picked Nuance specifically.
This is the text from Skype’s terms: “Notwithstanding any rights or obligations governed by the Additional Terms (as defined below) if, at any time you choose to upload or post User Submissions to the Skype Websites or through the Software (excluding Reports and excluding the content of your communications) you automatically grant Skype a non-exclusive, worldwide, irrevocable, royalty-free, perpetual, sub-licensable and transferable license of all rights to use, edit, modify, include, incorporate, adapt, record, publicly perform, display, transmit and reproduce the User Submissions including, without limitation, all trade marks associated therewith, in connection with the Skype Websites and Skype’s Software and Products including for the purpose of promoting or redistributing part or all of the Skype Websites and/or the Software or Products, in any and all media now known or hereafter devised. You also hereby grant each user of the Skype Website and/or Skype’s Software or Products a non-exclusive license to access your User Submission through the Skype Website and/or Software or Products and to use, copy, distribute, prepare derivative works of, display, perform and transmit such User Submissions solely as permitted through the functionality of the Skype Websites and/or Software or Products and pursuant to these Terms of Use. In addition, you waive any so-called “moral rights” in and to the User Submissions, to the extent permitted by applicable law.”
I can believe this ToU for the former.
I'd be surprised if there is any real difference in how either company respects your privacy (neither does). But for the most part, google seems to do its thing in the background and leave you alone. Microsoft is constantly popping things up asking you to rate this or that, flinging things you didn't ask for onto your screen, basically the spirit of clippy reborn into modern data collection practices. If I'm going to have my information exploited no matter what I do, I'd rather at least have it happen unobtrusively.
(To be fair, this is just my perception. I was in a g-suite shop for three years and now onto office 365 and I feel like it bothers me about stuff way more often the g-suite ever did)
I personally am more Microsoft friendly, simply for the reason that they always had and have an open platform to everyone.
I'm honestly interested in people's experiences and views on this topic.
The only reason Microsoft is trending back to "open" is they failed when they imitated Apple.
Apparently you missed a few decades of their development of the "Embrace, Extend, Extinguish" tactics.
As well as their tendency to throw exorbitant licensing conditions on nearly everything they sold.
As well as their repeated backdoor deals and maneuvers to cause vendor lock in across the entire PC market.
Note: everyone is getting this acquisition wrong. It's not about Dragon and their Speech-to-Tex. This is all about owning an enterprise Communication Platform (e.g. Contact Center, etc).
I'll repost my previous comment from the other HN thread below:
----
Everyone is wanting to take on Twilio. Last September, Microsoft first announced their Communication Cloud.
A huge focus at Twilio now is moving upstream to the Call Center, where Nuance is a significant player. So Microsoft picking up Nuance makes sense.
It’s clear Microsoft sees communication services as a strategic core part of their business.
(Even at the consumer / gamer level with the rumored Discord acquisition talks)
https://techcrunch.com/2020/09/22/microsoft-challenges-twili...
Well then we can expect Microsoft to swoop in for Twilio any year now.
And given that Jeff Lawson, is both he founder and CEO of TWLO - it's not entirely clear he would sell (unless the number is just so high, he has the fiduciary requirement that he has too - in which case I assume that would be north of $100B+)
But with regards to big acquisitions, MS is ironically and quite surprisingly able to fly under the radar in terms of antitrust. Literally every other tech company is not.
I got to meet a lot of the people involved at other companies in the project, including the Jim and Janet Baker, who founded Dragon, and many people at Intel up to and including Andy Grove. It was remarkable that he took interest in what was a relatively small project that was also distant from Intel's core products. I also met Jo Lernout, the L in L&H, which played a role in subsequent tragic events for the Bakers.
All those people, and most of the technologies from those days, are gone now. Dragon ended up a part of Nuance, which itself had been called ScanSoft, and, before that, was a part of Xerox that, if I recall correctly, was acquired by Xerox from Ray Kurzweil.
ScanSoft became a roll-up of a large number of speech technology companies. One of them was Nuance, and the roll-up was rebranded Nuance. Another acquisition was L&H, which had collapsed due to a financial scandal, which blew up after L&H had acquired Dragon. The Bakers got screwed and sued Goldman, who did the L&H deal. They lost.
And that is your capsule history of Nuance. Sorry to give short shrift to the acquired companies I have no firsthand knowledge of.
I believe the real story of Microsoft buying Nuance is that Nuance owns an enormous number of patents.
Top comment as I'm writing this says Nuance has a strong presence in the healthcare device market, but I'd be surprised if that alone was worth the purchase price.
Also, if you cannot operate a keyboard and must communicate by speech to operate a computer, it's pretty much Dragon NaturallySpeaking or GTFO. Integrating NaturallySpeaking tech into Windows would be a huge boon and further cement Windows as the os to have if you have disabilities.
Is there really a lot of NLP IP hidden behind corporate walls at this point? I just assumed Alexa, Siri, Google Assistant, etc were all using the same model architectures. Genuine question, can anyone shed some light?
Is there a way to make the others "conversational" if not, is Zoe the best example?
Did you find any competing product that came close?
Thank you
Lots of amazing open source out there but the difference between 90% accuracy and 99.7% accuracy can be very difficult to obtain.
Not to mention, quantified data sets, especially medical ones, can hold immense value.
gov-uk-list: https://accessibility.blog.gov.uk/2018/09/27/assistive-techn...
nvda-announcement: https://www.afb.org/aw/19/4/15104
pointless story aside, their enterprise valuation at the time was a little under 20% of what it is today, and the company remained mostly the same until 2 years ago. wonder what the catalyst was for their 5x valuation growth?
At the time of acquisition:
Nuance: $20B, employee strength 6000. 3M/employee
LinkedIn: 26B, employee strength ~12000. 2M/employee
LinkedIn was much more larger, more 'visible' and perhaps better talent attractor than Nuance at the time of acquisition.
It felt weird reading 'Moby Dick' to a computer for an hour , but at the time there was no product that could even get near Dragon in any performance metric.
Since natural language interpretation is such a widely used concept now I had taken it for granted that Dragon even existed anymore.
I don't know much about the company, and I don't know much about the product anymore, but that kind of persistence and consistency in this field is admirable.
Any ideas on why that is?
DragonDictate / Dragon NaturallySpeaking, that's why it sounded so familiar.
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Pinterest went from ~$250m revenue / quarter to tripling that in just 2 quarters. That's huge and unexpected that revenue would climb that high.
In English, there are quite a few contenders for TTS, eg. Amazon. Apple can find another vendor. But in some languages it is Google voice or Nuance and there are no other games in town.
Here you have been carefully exercising your stock options every month so you can pay only long-term capital gains taxes, and avoid AMT, and then BAM! sorry, you just sold it all at once. "BZZZT. Sucker."
They have also had a boost in stock with covid and more people using remote speech services
> October 18, 2005 — the company changed its name to Nuance Communications, Inc.
So Nuance was worth ~$220MM at the time of acquisition. I'm sure it's worth a lot more now but ScanSoft acquired like 50 other companies too, including old voice recording giant Dictaphone.
It seems Microsoft is still actively continuing to buy more companies and it seems Discord is still on the menu.
Microsoft's influence is growing deeply...
Microsoft got done for this before (bundling Internet Explorer with Windows) and if you look at where they are now buying out businesses and using dark patterns in Windows 10 to make people use Edge as well as implying it is a fundamental part of the OS they are way beyond was acceptable years ago.
That is the last speech recognition engine I would ever want to buy.