The competition regulator says it will not get in the way of Microsoft's proposed acquisition of Nuance. 

Nuance supplies speech recognition and transcription software primarily to the healthcare market, as well as customer engagement software that enables businesses to automate their customer service interactions.

The Australian Competition and Consumer Commission (ACCC) was called in to review the deal’s potential impact on competition.

The ACCC has announced it will not oppose the proposed acquisition.

“Microsoft and Nuance do not directly compete in healthcare transcription software,” ACCC Commissioner Stephen Ridgeway said.

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

The ACCC’s investigation found that healthcare transcription products are not currently widely used in Australia. However, Nuance currently faces some competition from alternative healthcare transcription suppliers and may face competition in future from other large technology firms expanding in the health sector.

The ACCC also concluded that the proposed acquisition was unlikely to substantially lessen competition in the customer engagement solutions market.

Microsoft does not compete with Nuance in the supply of these products to businesses because its tools are aimed at software developers, rather than finished products that can be used by businesses engaging with customers.

“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,” Mr Ridgeway said.

The ACCC also concluded that the proposed acquisition would not enable Microsoft to prevent Nuance or Microsoft’s rivals from competing effectively.

“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,” Mr Ridgeway said.