NEW YORK: Microsoft will acquire artificial intelligence and cloud computing company Nuance for $19.7 billion, bolstering the telemedicine services that became essential during the pandemic, the tech giant announced on Monday.

Nuance’s technology is used extensively in medical records and is currently employed in more than three-quarters of US hospitals, Microsoft said in a news release. The transaction is all-cash and the sum includes Nuance’s net debt.

Nuance’s technology is currently used by more than 55 percent of physicians and 75 percent of radiologists in the United States. Microsoft said the deal would double its potential healthcare market to nearly $500bn.

“Artificial intelligence (AI) is technology’s most important priority, and healthcare is its most urgent application,” Microsoft Chief Executive Satya Nadella said.

“Together, with our partner ecosystem, we will put advanced AI solutions into the hands of professionals everywhere to drive better decision-making and create more meaningful connections, as we accelerate growth of Microsoft Cloud for Healthcare and Nuance.”

This acquisition builds on the existing partnership between the two companies, which have been collaborating since 2019 in telemedicine, a sector whose growth has been spurred exponentially by Covid-19 lockdowns around the world.

Last year, the Redmond, Washington-based giant integrated Nuance Communication’s Dragon Ambient eXperience programme into its Teams communications software, which enables remote transcription of medical conversations.

Published in Dawn, April 13th, 2021