Commission européenne, DG COMP MERGER REGIST RY, 1049 Bruxelles, BELGIQUE  
Europese Commissie, DG COMP MERGER REGISTRY, 1049 Brussel,   BELGIË  
 
Tel: +32 229 -91111. Fax: +32 229 -64301. E -mail: COMP -MERGER -REGISTRY@ec.europa.eu .  EUROPEAN COMMISSION  
Brussels, 21.12.2021  
C(2021) 9923 final  
PUBLIC VERSION  
        
Microsoft Inc.  
One Microsoft Way 8/2284  
Redmond WA 98052  
United States of America  
Subject : Case M. 10290 – MICROSOFT/NUANCE  
Commission decision pursuant to Article 6(1)(b ) of Council Regulation 
No 139/20041 and Article 57 of the Agreement on the European Economic 
Area2 
Dear Sir or Madam,  
(1) On 16 November 2021 , the European Commission received notification of a 
proposed concentration pursuant to Article 4 and following a refe rral pursuant to 
Article 4(5) of Council Regulation (EC) No 139/2004 by which Microsoft 
Corporation (“Microsoft”, or the “Notifying Party”, USA) will acquire sole control 
of Nuance Communications, Inc. (“Nuance”, USA) within the meaning of Article 
3(1)(b) of the Merger Regulation (the “Transaction”). Microsoft and Nuance are 
together referred to as the “Parties”.  
                                                 
1  OJ L 24, 29.1.2004, p. 1 (the ’Merger Re gulation’). With effect from 1 December 2009,  the Treaty on the 
Functioning of the European Union (‘TFEU’) has introduced certain changes, such as the replacement of 
‘Community’ by ‘Union’ and ‘common market’ by ‘internal market’. The terminology of the TF EU will 
be used throughout this decision.  
2  OJ L 1, 3.1.1994, p. 3 (the ‘EEA Agreement’).  

 
 
2 1. THE  PARTIE S  
(2) Microsoft (USA) is a global technology company, which offers a wide range of 
products and services to customers. Microsoft’s products include: (i) Azure, a cloud 
computing platform; (ii) Microsoft Windows, operating systems  (“OS”)  for PCs, (iii) 
Microsoft 365 productivity services which include Word and Excel; (iv)  the 
enterprise communication software Teams ; and (v) Dynamics 365, custo mer 
relationship management (“CRM”) software.  
(3) Nuance (USA) is a software company that principally offers voice recognition and 
artificial intelligence  (“AI”)  software solutions in two business segments:  
 Healthcare, which consists of health -related speech and AI solutions  that help 
physicians to dictate or record patient’s information more efficiently. The 
healthcare business segment also contains Nuance’s Dragon Professional & 
Consumer (i.e. , AI-powered transcription solutions for professional and 
consumer  customers , “P&C” ). 
 Enterprise, in which Nuance provides: (i) voice engagement; (ii) digital 
engagement; and (iii) voice biometrics for customer service and sales 
engagement.  
(4) Nuance is primarily active in the United States, where the company generates [80-
90]% of its revenues. Nuance generates less than [10-20]% of its revenues in the 
EEA.  
2. THE  OPE RATION  AND CONCE NTRATION  
(5) The Transaction will be implemented by means of an Agreement and Plan of Merger 
(the “APM”) entered into on 11 April 2021 by Microsoft, Bi g Sky Merger Sub Inc. 
(“Merger Sub”), a newly created and wholly owned  subsidiary of Microsoft, and 
Nuance. Under the APM, Merger Sub will be merged with and into Nuance. 
Following this merger, Merger Sub will cease to exist, and Nuance will be a wholly 
owned subsidiary of Microsoft. This will take effect on closing, when all the 
necessary regulatory approvals and governmental consents have been obtained.  
(6) The Transaction consists of the acquisition of sole control by Microsoft over 
Nuance, within the meanin g of Article 3(1)(b) of the Merger Regulation.  
3. UNION  DIME NSION  
(7) The Transaction does not have an EU dimension within the meaning of Articles 1(2) 
and 1(3) of the Merger Regulation due to the limited revenues of Nuance in Europe.  
(8) Following the Parties’ rea soned submission  on 25 June 2021 , the Transaction was 
referred to the Commission pursuant to Article 4(5) of the Merger Regulation. The 
Transaction meets the legal requirements set out in Article 4(5) of the Merger 
Regulation: (i) it is a concentration wit hin the meaning of Article 3 of the Merger 
Regulation; and (ii) it is capable of being reviewed under the national competition 
 
 
3 laws of at least three Member States.3 The Commission informed the Parties on 19 
July 2021 that the case was deemed to have an EU  dimension.  
4. MARKE T DE FINITION  
(9) Nuance’s activities are related to transcription software , which is also referred to as 
automated speech recognition or speech -to-text (“STT”)  software. The output text 
can be used for a variety of purposes (e.g., to create a document, to complete forms 
or as an input to be analysed by additional software ). In the past, an end user dictated 
the text to the transcription software (referred to as dictation speech transcription) 
but the technology is evolving to allow specialised transcription software to convert 
conversational speech into text (referred to as ambient or conversational speech 
transcription).  
(10) The main markets affected by the Transaction are: (i) transcription software , (ii) 
customer engagement solutions , (iii) clou d computing services, (iv) enterprise 
communication services, (v) productivity  software  and (vi) customer relationship 
management software.  
4.1. Transcription software  
4.1.1.  Relevant product market  
(11) Transcription software is a technology used to convert speech into te xt. 
Transcription software is used in a wide range of applications, including, for 
example, document completion, conversational assistants, and speech translation. In 
the Form CO , the Notifying Party indicates that transcription technology is no longer 
cutting-edge. It has become mature to the point of commoditization, with firms 
offering both dedicated applications and transcription technology that developers can 
use as building blocks to include transcription capabilities into their own 
application.4 
4.1.1.1.  The Commission’s previous practice  
(12) There are no precedents in which this market was analysed by the Commission.  With 
respect to software in general, in  Broadcom/Symantec ,5 the Commission found that 
software products can generally be segmented based on their: ( i) functionality (e.g., 
transcription/voice recognition); (ii) the industry sector concerned (e.g., healthcare); 
and (iii) the end -user (e.g., enterprise software vs. consumer software)  
4.1.1.2.  The Notifying P arty’s  view 
(13) In the absence of relevant Commission prece dents, the Notifying Party observes that 
the Commission has typically considered that software products can be segmented 
                                                 
3  Form RS, footnotes 228 and 229. The Transaction is capable of being reviewed in Austria, Denmark and 
Germany. The Notifying Party cannot exclude that notification  thresholds are met also in Spain and 
Portugal.  
4  Form CO, paragraph 122.  
5  Commission decision of 30 October 2019 in case M.9538 – Broadcom/ Symantec Enterprise Security 
Business , paragraphs 14 -16 
 
 
4 based on: (i) their functionality (in this instance transcription software);6 (ii) the 
sector concerned (e.g., healthcare software);7 and (iii) their end -use (e.g. , enterprise 
vs. consumer software)8. The Notifying Party, therefore, submits the following  
product market definition s along the above criteria.  
(A) Transcription software for healthcare  
(14) The Notifying Party argues  that in past cases  the Commission has considered 
healthcare software to be in a separate market from software used in other sectors9 
and therefore considers that transcription software for healthcare constitutes a 
separate product market, with a potential sub -segment for healthcare transcription 
software  for radiology. Transcription software for healthcare should be considered 
as a separate product market from transcription software in other areas  as suppliers 
of transcription software for healthcare would offer products th at are deeply 
integrated with the workflow of healthcare providers and the specific applications 
they use, like the electronic health records (“ EHRs ”). Physicians also use a particular 
vocabulary that is very different from other sectors and cannot be subs tituted.  
(15) The Notifying Party further submits that transcription software for healthcare can be 
provided to customers at different levels of the supply chain. Nuance mostly  
provides i ts Dragon products to end -users  as ready -to-use solutions . In addition, 
Nuance offers  transcription functionality through software development kits 
(“SDKs ”) to developers. Microsoft targets developers with application programming 
interfaces (“ APIs ”) that include STT and text -to-speech (“TTS”) functionalities 
offered as part of A zure Cognitive Services . 
(16) The Notifying Party argues that, in any event, the exact product market definition  
can be left open as the Transaction does not raise any competition issues regardless 
of the product market definition.  
(B) Transcription software outsid e healthcare  
(17) Outside of healthcare, Nuance offers transcription software under the Dragon brand . 
Its software is  used primarily by professionals for transcription purposes to convert 
speech into text. Dragon Professional can also be used to control a Windo ws device 
OS and applications with a user’s voice, rather than a keyboard or a mouse, for 
accessibility purposes.  Microsoft does not offer transcription software as a 
standalone product. Instead, if offers transcription functionalities in some of its 
produ cts, such as Office 365 and Windows OS  as well as APIs as part of Azure 
                                                 
6  Broadcom/ Symantec Enterprise Security Business , parag raphs 14 -16; Commission decision of 20 June 
2011 in case M.6237 – Computer Sciences Corporation/iSoft Group , paragraph 22; Commission Decision 
of 8 March 2017 in case M.8223 – Micro Focus/HPE Software Business , paragraph 17.  
7  Commission decision of 20 Ju ne 2011 in case M.6237 – Computer Sciences Corporation/iSoft Group . 
8  Commission decision of 30 October 2019 in case M.9538 – Broadcom/Symantec , paragraphs 14 -16; 
Commission decision of 20 June 2011 in case M.6237 – Computer Sciences Corporation/iSoft Gro up, 
paragraphs 22 -25; Commission decision of 8 March 2017 in case M.8223 – Micro Focus/HPE Software 
Business , paragraph 17.  
9  Form CO, paragraph 274. See also Commission decision of 20 June 2011 in case M.6237 – Computer 
Sciences Corporation/iSoft Group , paragraph 32 . 
 
 
5 Cognitive Services that allow developers to integrate transcription functionalities 
into their products .10 
(18) The Notifying Party considers  that the market for transcription software outsi de 
healthcare constitutes a separate relevant product market, which is distinct from the 
market for transcription software for healthcare.  The Dragon Professional product 
can be used in a number of sectors . The “base” of products offered by Nuance  
outside of healthcare would  essentially be the same. Depending on the customer’s 
needs and preferences, Nuance works with the individual  customer to customise the 
software and map commands that match specific workflows (including specific 
linguistic requirements) , rather  than implementing significant differences  in its 
products between sectors outside healthcare . Nuance’s focus on certain  sectors is a 
commercial decision having identified sectors with use cases for its products.11  
(19) The Notifying Party  consider s that the relevant market for transcription software 
outside healthcare includes both transcription and voice control accessibility 
solutions.12 While the transcription and accessibility functionalities differ, the same 
speech recognition technology that powers  transcription can be used to power 
accessibility. The two functionalities are also offered together as part of the same 
Dragon software.  
(20) In addition, the Notifying Party argues that the lines between the two functionalities 
are blurred. What can be defin ed as accessibility functionality also includes 
transcription functionality. A user can command the OS to open a certain application 
(i.e., an accessibility function) and then continue to use the application with their 
voice, transcribing the voice input i nto text (i.e., the transcription function), relying 
on the same Dragon software. For instance, they could direct the OS to open their 
email application and then dictate the content of the email.13 
(21) The Notifying Party, therefore, submits that there is suppl y-side substitution between 
transcription software  and voice control accessibility, with some transcription 
software  offering both transcription and voice control accessibility functionalities.14 
The Notifying Party considers , in this respect,  that a segmen tation between specialist 
providers of accessibility software and OSs (which include accessibility features ) is 
more appropriate .15The Notifying Party also notes that transcription software can be 
offered at different levels of the supply chain, i.e., as AP Is or SDKs for developers to 
integrate speech recognition into other products, or as finished products (out -of-the-
box) ready for use by the end consumer. All such products would be part of the same 
overall market.  
(22) In any event, the Notifying Party conclud es that the definition of the relevant product 
market can be left open in the present case, as the Transaction does not raise any 
                                                 
10  Form CO, paragraphs 438 ss.  
11  Response to RFI dated 2 July 2021, paragraphs 6.1 -6.3. 
12  Form CO, paragraph 282.  
13  Form CO, paragraph 283.  
14  Form CO, paragraph 287.  
15  Form CO, paragraph 288.  
 
 
6 competition concern even if accessibility software is assessed separately from 
transcription software.16  
4.1.1.3.  The Commission’s asse ssment  
(23) The majority of respondents to the market investigation agree with the 
Commission ’s precedents  that software products can generally be segmented ba sed 
on their: (i) functionality ; (ii) the industry sector concerned; and (iii) the end -user 
(e.g., en terprise software vs. consumer software).17 On this basis, the Commission 
considers that based on its functionality, transcription software has to be 
distinguished from all other software products.  
(24) As to a potential segmentation of transcription software, d epending on its use in 
healthcare versus outside healthcare, the majority  of customers for transcription 
software consider s that, in general,  there are significant differences in 
transcription/voice recognition software depending on the specific industry s ector in 
which it is used.18 A competitor agree s with such position , but  only with respect to 
healthcare  as this sector needs a specific language model and vocabulary to function 
effectively.19 Since transcription software for healthcare raises specific ling uistic and 
technical integration issues  (because transcription software for healthcare needs to be 
integrated with EHR systems  to enable doctors to directly dictate patient’s medical 
information in it),20 the Commission  considers that transcription software  for 
healthcare belongs to a separate market . It can be left open whether  there is an 
overall market for transcription software outside healthcare , without industry 
distinction , as this does not affect the outcome of the assessment .  
(25) As regards the questio n whether transcription software used to enhance user 
accessibility  (“accessibility software”)  should be distinguished from transcription 
software , the market investigation did not provide elements indicating that 
accessibility software is separate from tr anscription software, but rather a specific 
use case of the latter.21 The Commission considers that such distinction can be left 
open , as the Transaction does not lead to anticompetitive concerns, regardless of the 
market definition adopted . 
(26) As regards the question whether an API/SDK for a transcription software is a 
suitable substitute for an out -of-the-box transcription software solution , the market 
investigation  triggered mixed replies. The majority of customers for transcription 
software replied that these products  are valid alternative s, although some 
respondents indicate that this is true for certain use cases only .22 The superiority of 
                                                 
16  Form CO, paragraph 294.  
17  Q2 - Questionn aire to customers for transcription software, replies to question 5; Q4 – Questionnaire to 
competitors for communication platforms, replies to question 5.  
18  Q2 - Questionnaire to customers for transcription software, replies to question 6.  
19  Q1 – Questi onnaire to competitors for transcription software, replies to question 6; Q4 – Questionnaire to 
competitors for communication platforms, replies to question 6. 1.  
20  For example, 3M’s speech recognition products are specifically designed for the healthcare  sector, and not 
for other sectors, such as the legal sector. 3M’s speech recognition products are built using specific 
medical concepts, in order to have a final product capable to function in the healthcare record system. See 
non-confidential minutes of call with 3M on 7 October 2021, Doc. ID 569.  
21  Q1 – Questionnaire to competitors for transcription software, replies to question 11. 1. 
22  Q2 – Questionnaire to customers for transcription software, replies to question 7.  
 
 
7 one solution over another will depend on customer -specific factors, such as resource 
and timing constraints, design goa ls, and issues specific to the customer’s industry. 
An out -of-the-box solution  enables customers  (such as hospitals)  to use the feature 
immediately, with the software provider managing the quality, robustness, and 
enhancement of the feature. The API/ SDK ap proach , on the other hand, enables  
customers to customi se and modify their use of this feature in a mann er that best 
suits their needs.23 The Commission considers that the market investigation is not 
conclusive as to whether out-of-the-box solutions and SDK /APIs are part of the 
same product market . The Commission, however, considers that the exact market 
definition can be left open, as this does not affect the outcome of the assessment .   
(27) As to the possible distinction between transcription software and ambi ent 
transcription software, t he replies to the market investigation have further indicated 
that there are similarities between transcription software and ambient transcription 
software, as they are both based on transcription technology.24 Ambient 
transcrip tion, however, is different in that it is able to capture conversation between 
individuals. To implement such functionality, the software needs to be able to 
distinguish and recognise different speakers. At the moment, ambient transcription 
software does n ot appear to be fully developed yet . Therefore , its current functions 
are mostly based on  transcription software . It is possible, in the future, that ambient 
transcription software develops into a separate product market  as it distinguishes 
itself further  from dictation transcription software . The Commission considers that, 
at the moment, ambient transcription software belongs to the same market as 
transcription software.   
(28) Based on the above considerations, the Commission considers that there is a separate  
market for transcription software for healthcare, including ambient transcription 
software  for healthcare , and that it can be left open whether there is an overall 
market for transcription software outside healthcare  (with a possible segmentation  by 
indus try). The Commission  also considers that , with respect to the possible 
distinction s between (i) transcription software outside healthcare and accessibility 
software , and (ii) out-of-the-box solutions and SDK/APIs  modules , the exact product 
market definitio n may be left open, as  this does not affect the outcome of the 
competitive assessment . 
4.1.2.  Relevant geographic market  
4.1.2.1.  The Commission’s previous practice  
(29) The Commission has typically considered software markets to be EEA -wide or 
worldwide  in scope .25  
                                                 
23  Q4 – Questionnaire to competito rs for communication platforms, replies to question 7.1.  
24  Q2 - Questionnaire to customers for transcription software, replies to questions 8, 8.1, 8.2 and 8.3; Q3 –
Questionnaire to competitors for cloud services, replies to questions 8, 8.1, 8.2 and 8.3.  
25  See for instance the markets for HR and FMS high -function solutions or software in Commission decision 
of 26 October 2004 in case M.3216 –  Oracle/PeopleSoft , paragraphs 174 et seq .; and more recently for 
productivity and CRM software in Commission dec ision of 6 December 2016 in case M.8124 – 
Microsoft/LinkedIn , paragraphs 27 and 56.  
 
 
8 4.1.2.2.  The Notify ing Party’s view  
(30) The Notifying Party submits that the markets for transcription software for 
healthcare and outside healthcare are at least EEA -wide in scope.  The Notifying 
Party  acknowledges that transcription software must understand a particular 
languag e and not all providers support all languages, which could potentially warrant 
narrower markets.26 The Notifying Party, however, argue s that: (i) the major 
suppliers  of transcription software are present across the EEA;  (ii) they rely on the 
same  underlying  technology and regularl y add support for new languages;  and ( iii) 
advances in deep learning technology mean that supply side substitutability between 
languages is increasing , with the process for developing a new language now taking 
between [...]. Such co nsiderations apply equally to transcription software for 
healthcare and outside healthcare (and, in relation to the latter, even if separate 
markets for transcription and accessibility software were to be defined) .27  
(31) In any event, the Notifying Party concl udes the definition of the relevant geographic 
market s can be left open in the present case, as the Transaction does not raise any 
competition concern regardless of the geographic scope of the markets.  
4.1.2.3.  The Commission’s assessment  
(32) The market investigation i ndicates that t ranscription software is considered in 
principle part of a global geographic market  28 As a customer explains : “The main 
difference is that each language needs support for speech recognition in that 
language. Apart from that they are mostly s imilar ”.29 A possible exception exists for 
transcription software for healthcare, which requires specific medical  vocabulary  and 
integration with EHR systems  in each country , in order to be developed and made 
available in additional languages .  
(33) Based on the  above considerations, the Commission observes that fundamental 
supply -side substitutability exists between different geographic areas. Transcription 
technology remains the same, regardless of the territory, and its adaptation to a 
specific language merely  depends on the existence of sufficient  business 
opportunit ies. The Commission , therefore,  concludes that the relevant geographic 
market s for transcription software for healthcare and for transcription software 
outside healthcare , and relevant segmentation s thereof,  are at least EEA -wide, if not 
global.     
4.2. Customer engagement solutions  
(34) Customer engagement solutions are business applications that simulate a voice or 
text conversation with customers to deliver information or take action on behalf of 
the custo mer. Customer engagement solutions operate via voice, live chat, SMS, 
consumer messaging applications , native mobile applications , social media and other 
web-based or mobile interfaces.  
                                                 
26 Form CO, paragraph 279.  
27  Form CO, paragraphs 278 -280 and 295 -298. 
28  Q2 – Questionnaire to customers for transcription software, replies to question 9; Q3 –Questionnair e to 
competitors for cloud services, replies to question 10.  
29  Q2 – Questionnaire to customers for transcription software, replies to question 9.1.  
 
 
9 (35) Voice engagement products enable human -like interactions allowing indi viduals to 
self-serve and successfully resolve issues by engaging with the software. Powered by 
natural language understanding  (“NLU”) , conversational voice recognition software 
allows customers to use their own words while the technology accurately captur es 
their intent, predicts why they are calling and addresses the matter at hand directly. 
Nuance voice engagement software allows callers to access information via pre -
recorded messages and/or be transferred to a human agent when needed to provide 
an adequ ate answer. They are offered either as on -premises or as cloud -based 
solutions.  
(36) Digital engagement products use natural language processing, machine learning, AI 
and analytics (including virtual assistants, chatbots, and live assist messaging over 
digital channels ) as means of addressing customer requests. Nuance’s technology 
allows its clients to engage customers on desktops, smartphones and tablets by 
relying on automated digital channels as much as possible.  
(37) Voice biometric products enable customers to u se voice to authenticate their 
customers, identify fraudsters, and detect cases of potential fraud. The products 
enable enterprises to authenticate customers without passwords or lengthy security 
questions relying instead on the customers’ interactions wit h the voice recognition 
system and their voice.  Nuance’s standalone products offer a voice biometrics 
solution for enterprises. Microsoft does not have a similar product, but recently 
included limited speaker recognition technology in Azure Cognitive Servi ces. 
4.2.1.  Relevant product market  
4.2.1.1.  The Commission’s previous practice  
(38) In previous cases , the Commission has taken the view that business application 
software could be broadly categorised  into: (i) infrastructure software; and (ii) 
enterprise application software  (“EAS”) .30 There are no precedents in which the 
Commission assessed the specific customer engagement solutions at issue in the 
Transaction.  
4.2.1.2.  The Notifying Party’s view  
(39) According to the Notifying Party, customer engagement solutions are a separate 
market,  within the broader  business software space , and can be segmented by 
functionality: (i) voice engagement products; (ii) digital engagement products; and 
(iii) voice biometric products. The Notifying Party submits that these markets should 
not be further segm ented according to industry application (e.g ., banking, retail, 
transport)  as the core technology is shared and the customer engagement industry is 
characterised by vendors that offer core platforms and  capabilities across vertical 
sectors, which are custo mised to meet an individual enterprise’s  business needs .31 
                                                 
30  Commission decision of 26 October 2004 in case M.3216 – Oracle/PeopleSoft , paragraph 15.  
31 Form CO, para graphs 303.  
 
 
10 (40) The Notifying Party further argues  that there is no need to segment the market for 
the provision of APIs or SDKs for customer engagement solutions by the technology  
used (i.e., STT, TTS and NLU ).32 
(41) In any event, the Notifying Party considers that for the purposes of this case the 
precise scope of the product market can be left open, given the absence of 
competition concerns regardless of the precise market definition.  
4.2.1.3.  The Commission’s assessment  
(42) Information collected during the investigation  indicates that customer engagement 
solutions  include voice engagement , digital engagement and voice biometrics. The 
former two technologies  are used to design callbots  or chatbots  for consumers , that 
is software s olutions that help customers to understand and answer queries from their 
clients, with no (or minimal) human intervention.  Voice biometrics is used by 
businesses to identify customers and verify their identity by recognising the sound of 
their voice.  
(43) Indiv idual elements of t he technology are similar to those  of transcription software 
and includes  components such as STT engines, TTS engines and NLU engines. Such 
components are used to assemble a finished product that can be customised and used 
across various  customers and industries. Unlike transcription software, customer 
engagement solutions are not used to dictate human language, but rather to convert 
it, process  the converted statement  by artificial intelligence and generate a reply 
useful to the customer .33 
(44) Based on the above, the Commission considers that customer engagement solutions , 
possibly segmented into v oice engagement, digital engagement and voice 
biometrics,  are part of a product market distinct from transcription software , due to 
the additional elements a customer engagement solution requires compared to 
transcription software as well as the different use cases the two technologies address. 
The Commission considers that it can be left open  whether voice engagement, digital 
engagement and voice bi ometrics are part of the same market , as this does not affect 
the outcome of the competitive assessment.   
4.2.2.  Relevant geographic market  
4.2.2.1.  The Commission’s previous practice  
(45) The Commission has typically considered software markets to be EEA -wide or even 
worldwi de in scope .34 
                                                 
32  Form CO, paragraph 315 -316. Nuance does not generally supply APIs and SDKs on a standalone basis, 
and Nuance’s sales of APIs and SDKs are very limited both worldwide and in the EEA (less than [...] 
worldwide and less than [...] in the EEA in  2020). Nuance focuses on the provision of out -of-the-box 
solutions that Nuance or its resellers fully customise to cater to the requirements of specific customers. 
The technology for “general purpose” voice recognition (STT, NLU and TTS with no specialise d 
vocabulary or use case) is commoditised, and, according to the Notifying Party, other providers offer such 
services, including Amazon, Google, IBM, Facebook, Baidu.  
33  Minutes of the call dated 27 September 2021, Doc ID 183.  
34  See for instance the marke ts for HR and FMS high -function solutions or software in Commission decision 
of 26 October 2004 in case M.3216 –Oracle/PeopleSoft , paras 174 et seq.; and more recently for 
 
 
 
11 4.2.2.2.  The Notifying Party’s view  
(46) The Notifying Party considers that markets for customer engagement solutions, 
regardless of segmentation, can be assessed at worldwide or EEA -level. This is 
because suppliers are active globally, delivering their so lutions worldwide and across 
the EEA. Although customer engagement solutions based on voice technology 
(voice recognition and voice biometrics) must, by definition, be able to understand 
different languages, the vast majority of voice recognition and voice  biometric 
suppliers offer their products across the EEA or even across the globe.35 
4.2.2.3.  The Commission’s assessment  
(47) Information in the Commission ’s file indicates that suppliers of such technology 
may initially focus on a specific  country and then expand to other countries. This 
appears possible, in particular, in European countries, where suppliers seem to be 
able to develop a new language model without too much difficulty.36 
(48) The Commission therefore considers that the relevant geographic market is at least  
EEA-wide, if not global . The exact geographic market definition, however, can be 
left open, as  this does not affect the outcome of the competitive assessment .   
4.3. Cloud computing services (IaaP, PaaS)  
(49) Cloud  providers offer a “stack” of hardware and software com ponents/functionalities 
on-demand to customers. These services allow customers to avoid the costs related 
to the purchase, configuration, and maintenance of on -premises data centres and 
software licenses, while benefiting from the most advanced hardware an d software 
solutions and the ability to easily scale up and down (i.e., add or subtract resources 
when needed, for instance due to a sudden increase or decrease in traffic to a hosted 
website ). 
(50) Microsoft offers general, industry -agnostic solutions, includi ng Azure public cloud, 
which delivers a combination of infrastructure -as-a-service (“IaaS”) and platform -as-
a-service (“PaaS”) services , including data analytics  services (e.g., Azure Data 
Explorer and Azure Data Lake) ; Microsoft 365 productivity services (including 
Word, PowerPoint, Teams and Excel), which are software -as-a-service (“SaaS”) 
products; and Dynamics 365, another SaaS product that consists of modular 
applications that include customer relationship management (“CRM”) functionality. 
Nuance is no t active in the provision of cloud services  and data analytics .  
4.3.1.  Relevant product market  
4.3.1.1.  The Commission’s previous practice  
(51) In Microsoft/GitHub ,37 the Commission considered whether a segmentation of cl oud 
computing services between Infrastructure -as-a-Servi ce (“IaaS”) and Platform -as-a-
                                                                                                                                                      
productivity and CRM software in Commission decision of 6 December 2016 in case M.81 24 – 
Microsoft/LinkedIn , paras 27 and 56.  
35  Form CO, paragraphs 317 -318. 
36  Minutes of the call dated 27 September 2021, Doc ID 183.  
37  Commission decision of 19 October 2018 in Case M.8994 – Microsoft/GitHub , paragraph 61.  
 
 
12 Service (“PaaS”) is appropriate, but it ultimately left this question open and assessed 
the relevant transaction on an overall market for cloud computing services.  
(52) In Google/Fitbit ,38 the Commission , after considering  whether it was appropriate to 
define a product market for digital healthcare, including the provision of cloud and 
data analytics services  and other digital services for healthcare , concluded that it was 
not appropriate to do so . This is  because the provision of c loud services “ is 
substantially different from other digital healthcare initiatives ” and instead 
considered cloud computing services as a separate product market and defined the 
relevant market as that for the “ provision of cloud infrastructure and data an alytics ”.  
4.3.1.2.  The Notifying Party’s arguments  
(53) The Notifying Party submits that IaaS and PaaS form part of a single market due to 
both demand -side and supply -side substitution. All major public cloud computing 
service providers offer a full range of IaaS and P aaS services to customers. Amazon 
Web Services (“ AWS ”) initially focused on IaaS but subsequently expanded its 
services to offer a fully -fledged developer platform typically associated with PaaS. 
Microsoft’s Azure service initially built a market presence in PaaS and subsequently 
positioned itself as a provider of a broad range of IaaS and PaaS services.39  
(54) The Notifying Party considers that the Transaction should be assessed on the overall 
market for cloud computing services, but that the exact definition o f the relevant 
product market can be left open, as the Transaction does not raise any competition 
concerns regardless of the market definition adopted.40 
4.3.1.3.  The Commission’s assessment  
(55) All the Parties’ competitors respond ing to the market investigation agree w ith the 
Commission ’s previous definition of an overall market for cloud services and data 
analytics without further segmentation between PaaS  and IaaS.41 
(56) The Commission therefore concludes that the relevant product market is the overall 
market for cloud ser vices and data analytics without further segmentation between 
PaaS and IaaS .  
4.3.2.  Relevant geographic market  
4.3.2.1.  The Commission’s previous practice  
(57) Previously, the Commission left open whether the geographic scope of the market 
for the provision of cloud computing  services  was EEA wide or worldwide.42 In 
                                                 
38  Commission decision of 17 D ecember 2020 in Case M.9660 – Google/Fitbit , para. 266 and 272 -274. 
39  Form CO, paragraph 320.  
40 Form CO, paragraph 322.  
41  Q1 – Questionnaire to competitors for transcription software, replies to question 13; Q3 – Questionnaire to 
competitors for cloud se rvices, replies to question 11.  
42  Commission decision of 15 December 2014 in case M.7458 – IBM / INF Business of Deutsche Lufthansa , 
paras. 30 -32; Commission decision of 21 December 2016 in case M.8180 – Verizon / Yahoo , para. 75.  
 
 
13 Google/Fitbit , the Commission concluded that the market in question is at least 
EEA-wide in scope.43   
4.3.2.2.  The Notifying Party’s view  
(58) The Notifying Party submits that the market definition can be left open , as the 
Transa ction does not raise any concern regardless of the geographic scope of the 
market.  
4.3.2.3.  The Commission’s assessment  
(59) All the Parties’ competitors respond ing to the market investigation consider  the 
relevant geographic market for cloud and data analytics services  to be  worldwide in 
scope.44 
(60) The Commission  observes that suppliers  of cloud services  (e.g., Microsoft, Amazon, 
Google, etc.)  are multinational technology providers, all active at global level. In 
addition, cloud solutions, whether IaaS or PaaS , consist of solutions accessible from 
any geographic location, not of physical hardware. The Commission therefore 
concludes that the relevant geographic market for cloud and data analytics services is 
worldwide in scope . 
4.4. Enterprise communication services  
(61) Microsoft’s e nterprise communication service is Teams. Microsoft Teams is the 
successor to Skype for Business Online. Teams includes features such as voice and 
video calling, instant messaging, video conferencing, document sharing, and team 
collaboration. Teams is a cl oud-native service. There is no on -premises version.45 
Nuance is not active in enterprise communication service.46 
4.4.1.  Relevant product market  
4.4.1.1.  The Commission’s previous practice  
(62) The Commission has assessed the enterprise communications market in a number of 
cases, some of them involving Microsoft. In Microsoft/Skype , the Commission 
looked at enterprise communication services as a single product market and 
considered, but ultimately left open, whether it would be appropriate to further 
segment it on the basis of f unctionality ( e.g., advanced telephony, unified messaging 
– email, fax, voice messaging combined, web, voice and videoconferencing, 
IM/presence, collaborating tools, etc.), platform ( e.g., PCs, smartphones, tablets), 
and operating system .47 In the more rece nt Microsoft/LinkedIn  decision, the 
Commission carried out its assessment on the overall market for enterprise 
                                                 
43  M.9660 - Google/Fitbi t, paragraph 278.  
44  Q1 – Questionnaire to competitors for transcription software, replies to question 14 and Q3 – 
Questionnaire to competitors for cloud services, replies to question 12.  
45  Form CO, paragraphs 255 -256. 
46  Form CO, Table 8.  
47 Commission de cision of 6 December 2016 in case M.8124 – Microsoft/LinkedIn , paragraphs 81 -83.  
 
 
14 communication services.48 The Commission did not yet assess whether there is a 
separate market for enterprise communication services in the health care sector.   
4.4.1.2.  The Notifying Party’s view  
(63) The Notifying Party considers that it is appropriate to define a separate market for 
enterprise communication services in the healthcare sector in the present case. 
Within the healthcare sector , customers place a pa rticular emphasis on security and 
privacy features of the service  and have traditionally relied on distinct trusted 
suppliers that integrate communication services with telehealth services. However, 
the Notifying Party submits that ultimately the exact sco pe of  the market can be left 
open as the Transaction does not raise any competition concern regardless of how 
the product market is defined.49 
4.4.1.3.  The Commission’s assessment  
(64) The majority of respondents to the market investigation agrees with the 
Commission’s p revious market definition of communication services separating 
consumer from enterprise communication services.50 As some respondents pointed 
out, typically, enterprise tools require significantly more scalability, higher accuracy, 
and more configuration op tions than consumer tools.51  
(65) As to the possible existence of a separate market for healthcare customers, i n the 
market investigation, t he question whether specific features of such product s are 
necessary to carry out medical visits has triggered mixed repl ies.52 In particular, 
some respondents have noted that, as tele -healthcare becomes more widespread in 
the future, healthcare pr ofessionals and institutions might find  it useful to have  
communication services with specific features, such as integration with their 
electronic health records.53   
(66) The Commission therefore considers that the relevant product market includes 
enterprise communications services, distinct from consumer services. The question 
whether  a separate market exists for enterprise communication  services used in the 
healthcare sector can be left open, as  this does not affect the outcome of the 
competitive assessment.  
                                                 
48 Commission decision of 6 December 2016 in case M.8124 – Microsoft/LinkedIn , paragraphs 81 -83.  
49  Form CO, paragraph 340.  
50  Q2 – Questionnaire to customers for transcripti on software, replies to question 10.  
51  Q4 – Questionnaire to competitors for communication platforms, replies to question 11.1.  
52  Q2 – Questionnaire to customers for transcription software, replies to question 11; Q4 – Questionnaire to 
competitors for co mmunication platforms, replies to question 12.  
53  Q2 – Questionnaire to customers for transcription software, replies to question 11.1; Q4 – Questionnaire 
to competitors for communication platforms, replies to question 12.1.  
 
 
15 4.4.2.  Relevant geographic market  
4.4.2.1.  The Commission’s previous practice  
(67) The Commission has previously indicated that the market for enterpri se 
communication services is at least EEA -wide in scope, if not worldwide, but has 
ultimately left the precise scope of the market open.54 
4.4.2.2.  The Notifying Party’s view  
(68) In line with the precedent s, the Notifying Party considers that the market for 
enterprise c ommunication services is at least EEA -wide in scope, if not worldwide, 
but that the precise market definition can be left open since the Transaction does not 
give rise to any competition concern regardless of how the  geographic scope of the 
market is defin ed.55 
4.4.2.3.  The Commission’s assessment  
(69) Almost all respondents to the market investigation agree that the geographic scope of 
the market for communication services is global.56 There are some geographic 
differences (for example , a different legal framework for pri vacy in the EEA and in 
the United States) that could militate toward having markets divided by region, such 
as the EEA.57 Generally, however, in view to the globalisation of many business 
sectors, communication services are provided on a global scale. The C ommission 
therefore concludes that the market for enterprise communication services is global 
or at least EEA -wide in scope.  
4.5. Productivity software  
(70) Productivity software consists of applications that allow users to create documents, 
graphs, worksheets and p resentations. Productivity software includes applications 
such as word processing and spreadsheet applications, and can be delivered either as 
on-premises software or as an online service hosted in the cloud (SaaS).  Microsoft 
365 is Microsoft’s cloud -based  productivity suite for PCs and mobile devices. 
Nuance is not active in this space.  
4.5.1.  Relevant product market  
4.5.1.1.  The Commission’s previous practice  
(71) In Microsoft/LinkedIn , the Commission defined productivity software as applications 
that enable users to create d ocuments, databases, graphs, worksheets, etc. This 
includes applications such as word processing and spreadsheet applications.58 
Productivity software can be used either on -premises on the user’s own hardware or 
in the cloud, hosted by a third party.  
                                                 
54  Commission decision of 7 Oct ober 2011 in case M.6281 – Microsoft/Skype . 
55  Form CO, paragraph 343.  
56  Q2 – Questionnaire to customers for transcription software, replies to question 12; Q4 – Questionnaire to 
competitors for communication platforms, replies to question 13.  
57  Q4 – Questionnaire to competitors for communication platforms, replies to question 13.1.  
58  Commission decision of 6 December 2014 in case M.8124 – Microsoft/Linkedin , paragraph 19.  
 
 
16 (72) In Microsoft/Nokia , the Commission considered that mobile productivity 
applications  constituted a distinct market separate from other types of applications  
for smartphone devices and productivity applications  for desktops and laptops.59 In 
Microsoft/LinkedIn , the  Commission retained its previous product market definition 
of productivity software for PCs, without considering it necessary to further segment 
the market depending on the type of productivity software.60 
4.5.1.2.  The Notifying Party’s arguments  
(73) The Notifying Part y considers the relevant product market to be productivity 
software for PCs, although the exact definition can be left open as the Transaction 
does not raise any competition concern regardless of how markets are defined.  
4.5.1.3.  The Commission’s assessment  
(74) The maj ority of customers responding to the market investigation agrees that a 
separate market for the productivity software for PCs (desktops and laptops) exists, 
without it being necessary to consider whether this market could be further 
segmented depending on the type of productivity software (e.g., personal 
productivity applications.61 
(75) In the above respect, the Commission observes that mobile productivity applications  
have fewer features, provide less functionality and are less user -friendly than 
applications  designed for PCs. From the supply -side perspective, productivity 
applications  for PCs are written for different hardware environments: faster 
processors, larger screens and also the presence of a mouse and physical keyboard. 
From the demand point of view, t ypically, users use their smart mobile devices 
mainly to read and check items or make small edits, and not for intensive  work over 
extended periods of time. The Commission therefore considers that the relevant 
product market is the market for productivity software for PCs (desktop and 
lapto ps), excluding mobile productivity applications , without further segmentations.  
4.5.2.  Relevant geographic market  
4.5.2.1.  The Commission’s previous practice  
(76) In previous decisions, the Commission found that the market for productivity 
applications was at least EEA -wide, if not worldwide, in scope, but ultimately left 
the precise geographic market definition open.62 
4.5.2.2.  The Notifying Party’s arguments  
(77) The Notifying Party agrees with the Commission ’s approach in previous cases.   
                                                 
59  Commission decision of 4 December 2013 in case M.7047 – Microsoft/Nokia , parag raphs 46 -55. 
60  Commission decision of 6 December 2014 in case M.8124 – Microsoft/Linkedin , paragraph 25.  
61  Q2 – Questionnaire to customers for transcription software, replies to question 13 . 
62  Commission decision of 4 December 2013 in case M.7047 – Micr osoft/Nokia , paragraphs 80 -81. 
 
 
17 4.5.2.3.  The Commission’s  assessment  
(78) Almost all market respondents agree that the relevant geographic market for 
productivity software is worldwide in scope.63 In particular, it is noted that 
productivity software is installed in devices , which are sold globally and also 
provided a s SaaS that can be accessed and used worldwide.64 
(79) The Commission therefore concludes that the relevant geographic market definition 
for productivity software is worldwide in scope.  
4.6. Operating systems  
(80) OS are system software products that control the basic fun ctions of computing 
devices such as PCs, tablets and smartphones and enable the user to operate the 
device and run application software on it. Windows 10, until recently Microsoft’s 
latest OS product, was launched in July 2015 and is designed for both PCs and 
tablets. The successor, Windows 11, has been launched in 4 October 2021. Nuance 
is not active in this space.  
4.6.1.  Relevant product market  
4.6.1.1.  The Commission’s previous practice  
(81) The Commission assessed OS in a number of cases, in which they  were defined as 
syste m software products that control the basic functions of computing devices such 
as servers, PCs, tablets and smartphones to enable the user to use the device and run 
application software on it.65 In Google/Motorola Mobility , while leaving the exact 
market de finition open, the C ommission took the view that OS for PCs and OS  for 
smart mobile devices belong to separate product markets, given that both such OS 
use different hardware and have different performance capacities.66 This approach 
was confirmed recently in Google/Fitbit .67     
4.6.1.2.  The Notifying Party’s arguments  
(82) The Notifying Party considers that the relevant product market is OS for PCs, 
although the exact market definition can be left open.68  
                                                 
63  Q2 – Questionnaire to customers for transcription software, replies to question 14.  
64  Q2 – Questionnaire to customers for transcription software, replies to question 14.1.  
65 Commission decision of 13 February 2012 in case  M.6381 – Google/Motorola Mobility , paragraphs 26 
and 29 -30; Commission decision of 4 December 2013 in case M.7047 – Microsoft/Nokia , paragraph 27; 
Commission decision of 6 December 2016 in case M.8124 –Microsoft/LinkedIn , paragraphs 11 -15;  
Commission dec ision of 18 July 2018 in case AT. 40099 – Google/Android , paragraphs 218 -219. 
66 Commission decision of 13 February 2012 in case M.6381 – Google/Motorola Mobility , paragraphs 26 
and 29 -30; Commission decision of 4 December 2013 in case M.7047 – Microsoft/No kia, paragraph 27; 
Commission decision of 6 December 2016 in case M.8124 – Microsoft/LinkedIn , paragraphs 11 -15; 
Commission decisions of 6 September 2018 in case M.8788 – Apple/Shazam , recitals 82 -85 and of 18 July 
2018 in case AT.40099 – Google/Android , paragraphs 218 -219. 
67 Commission decision of 17 December 2020 in case M.9660 – Google/Fitbit , paragraph 95.  
68  Form CO, paragraph 327.  
 
 
18 4.6.1.3.  The Commission’s assessment  
(83) The majority of respondents to the mar ket investigation agrees that OS for PCs 
belong to a separate product market (as opposed to OS for mobile devices). 
Although one respondent notes that a converge nce might take place between OS  for 
PCs and mobile devices in the future , it indicates that the re will still be differences 
between stationary and mobile systems .69 
(84) Based on the above considerations, the Commission therefore considers that the 
relevant product market is the market for OS for PCs.  
4.6.2.  Relevant geographic market  
4.6.2.1.  The Commission’s previous p ractice  
(85) The Commission has previously concluded that the markets for OS, including PC 
OS, are least EEA -wide, or even worldwide, in scope.70 
4.6.2.2.  The Notifying Party's arguments  
(86) The Notifying Party agrees with the Commission’s approach to previous cases and 
subm its that the same approach can be taken in this Transaction.  
4.6.2.3.  The Commission’s assessment  
(87) Almost all market respondents agree that the relevant geographic market for OS is 
worldwide in scope.71 
(88) Based on the above considerations  and on the fact that OS are in stalled on PCs sold 
worldwide to satisfy a global demand , the Commission therefore considers that the 
relevant  geographic market for OS for PCs is worldwide . 
4.7. Customer Relations hip Management (CRM) software  
4.7.1.  Relevant product market  
(89) CRM software helps compani es manage their customer interactions by organi sing, 
automating, and synchroni sing data from sales, marketing, customer databases, 
customer service and other technical functions. CRM software consists of software 
that collates sets of data and displays the m in a user -friendly manner. Microsoft’s 
CRM product is Dynamics 365. Nuance does not have a CRM product.  
4.7.1.1.  The Commission’s previous practice    
(90) The Commission previously considered possible segmentations of CRM products 
based on  functionality  (e.g., custome r service, sales, marketing, and digital 
                                                 
69  Q2 – Questionnaire to customers for transcription software, replies to question 15.  
70  Commission decision of 17 Decemb er 2020 in case M.9660 – Google/Fitbit, para. 100.  
71  Q2 – Questionnaire to customers for transcription software, replies to question 16.  
 
 
19 commerce ), type of service (i.e., cloud or on -premises), and customer size or 
industry  sector.72 However, it eventually  left the exact market definition open.  
4.7.1.2.  The Notifying Party’s view  
(91) The Notifying Party does not c onsider it necessary to further segment the CRM 
market. In particular, it argues that there is not a sound basis for defining CRM 
submarkets based on the industry sector. While, in fact, there are CRM providers 
that specialise in serving a particular indus try (e.g., Healthgrades CRM for 
healthcare; Builder CRM & Marketing for construction; and Masterdigm CRM for 
real estate professionals), customers in those industries also have the choice of using 
one of the more general -purpose CRM solutions, and many do.  Given this demand 
substitutability, the Notifying Party submits that CRM constitutes a single market 
that should not be segmented by industry sector .73  
(92) In any case, the Notifying Party considers that for the purposes of this case, the 
precise scope of the  product market can be left open, given the absence of 
competition concerns regardless of the precise market definition.  
4.7.1.3.  The Commission’s assessment  
(93) The Commission considers that the exact product market definition, including 
whether CRM should be segment ed by industry , functionality, type of service and 
customer size , can be left open, as  this does not affect the outcome of the 
competitive assessment . 
4.7.2.  Relevant geographic market  
4.7.2.1.  The Commission’s previous practice  
(94) The Commission has previously concluded tha t the CRM market is at least EEA -
wide, if not worldwide, but has ultimately left open the precise scope of the 
geographic market.74 
4.7.2.2.  The Notifying Party’s view  
(95) The Notifying Party submits that the market for CRM software is worldwide in 
scope on the basis th at (i) CRM solutions do not vary significantly across regions; 
(ii) there are no significant regulatory or technical differences or local customisation 
in the provision of CRM solutions (apart from local language adjustments); (iii) 
there is no difference in transport costs, in part given the prevalence of cloud -based 
solutions; and (iv) the main providers operate on the basis of global or multi -country 
contracts with their customers.75 
                                                 
72  Commission decision of 6 December 2016 in case M.8124 – Microsoft/LinkedIn , paragraphs. 36 -50. 
73  Form CO, paragrap hs 347 -348. 
74  Commission decision of 6 December 2016 in case M.8124 – Microsoft/LinkedIn , paragraphs. 36 -50. 
75  Form CO, paragraph 350.  
 
 
20 (96) In any case, the Notifying Party argues that the exact scope of the rele vant 
geographic market can be left open,  given the absence of competition concerns.76 
4.7.2.3.  The Commission’s assessment  
(97) The Commission considers that there are no elements on its file suggesting a 
departure from its previous decisional practice. The Commission co nsiders that the 
market for CRM software is at least EEA -wide but that the exact geographic market 
definition can be left open, as  this does not affect the outcome of the competitive 
assessment . 
5. COMPE TITIVE ASSE SSME N T 
(98) The Parties’ activities overlap with r egard to transcription software (including its use 
for accessibility purposes) and customer engagement solutions. However, the Parties 
submit that there are no horizontally affected markets, either in the EEA or globally  
(see Section 5.1 below) .  
(99) There is one vertically affected market: Microsoft’s upstream cloud computing 
activities and Nuance’s downstream transc ription software for healthcare  (see 
Section 5.2 below) .  
(100)  In addition , the Commission assessed potential conglomerate concerns in the 
following markets77: 
 Nuance’s transcription software for healthcare and Microsoft’s enterprise 
communication services  (see Section 5.3.1  below) ; 
 Nuance’s transcription software outside healthcare and Microsoft’s 
productivity software  (see Section 5.3.2  below) ;  
 Nuance’s transcription software outside healthcare and Microsoft’s PC OS 
(see Section 5.3.3  below) ; and  
 Nuance’s transcription software for healthcare and Microso ft’s CRM 
software (see Section 5.3.6  below ). 
5.1. Horizontal relationships  
(101)  The Transaction involve s no significant horizontal overlaps between the Parties.  In 
relation to the transcription software market  and its various segmentations78, the 
transaction could lead to a horizontal overlap  (see Section 5.1.1  below), in which 
case the transcription software for healthcare market would be affected based on 
                                                 
76  Form CO, paragraph 351.  
77  The Transaction gives rise to a number of conglomerate relationships based on actual or p otential product 
integrations between Microsoft and Nuance.  
78  See Section 4.1 above. This Section discusses the overall transcription software market, a transcription 
software market for healthcare, a transc ription software ma rket outside healthcare as well as accessibility 
solutions. These markets are discussed both at an EEA and worldwide level.   
 
 
21 Nuance’s EEA -wide share of [60-70]%, and worldwide share of [50-60]%.79 There 
are no other segmentations that give rise to affected markets.  
(102)  In relation to the m arket for customer engagement solutions , including potential 
segments for voice engagement, digital engagement and voice biometrics, the 
Parties’ activities result in limited horizontal overlaps with modest combined market 
shares, and in any event below 20 %.80 Therefore, even based on the narrowest 
market definition possible, there are no horizontally affected markets.  
5.1.1.  Transcription software for healthcare  
(103)  Nuance’s core business is transcription technology that is used in a variety of 
applications and servi ces that capture and convert spoken words into digital text . The 
healthcare sector is a key focus area for Nuance, with applications and services that 
are integrated into the workflow of physicians and that are plugged into the tools that 
are used in the h ealthcare  sector, including in EHRs. In healthcare,  first, Nuance’s 
main product is Dragon Medical, with a newer cloud -based version branded Dragon 
Medical One ( “DMO ”). DMO is a transcription product that can be used by 
physicians to dictate a patient’s st ory, diagnosis, results, etc. , which are then 
transcribed in to records in the EHR.  DMO can be installed on any Windows -based 
PC. It is not available on other PC OS  such as macOS.81 Second , in 2020, Nuance 
launched Dragon Ambient eXperience (“ DAX ”), a health care service recently co-
developed with Microsoft.82 DAX is an ambient clinical intelligence product that 
extends the functionalities of DMO with ambient sensing technology and AI. DAX 
is currently being launched in the US and is not currently available in the EEA. 
Third, Nuance also supplies products specifically focused on radiology, i.e ., 
PowerScribe and PowerShare, which have [...] sales in the EEA. Finally, in addition 
to providing  complete out-of-the-box solutions for physicians, Nuance also offers 
SDK s that enable developers to integrate Nuance’s technology into their application: 
SpeechMagic and Dragon Medical SpeechKit.   
(104)  Within the potential market for transcription software in healthcare, Nuance is the 
market leader  with an EEA -wide share of [60-70]%, and a worldwide share of [50-
60]%.83 Within the EEA, the second and third largest competitors are Recognosco 
and MediaInterface with EEA market shares in 2020, according to the Notifying 
Party’s estimates, between [10-20]% and between [10-20]% respective ly, and 
worldwide market shares in 2020 between [0-10]% each .84 The third largest 
competitor, 3M/M*Modal has a low market share in the EEA of [0-5]%, as 
                                                 
79 Form CO, Tables 9 and 9A (2020). These market shares are based on installed base and which increases to 
[60-70]% when considerin g market shared based on new sales.  
80  2020 market shares.  
81  See https://nuancecommunity force.com/NuanceHealthca reSupport/s/article/Is -there -an-Apple -Macintosh -
version -of-Dragon -Medical12729 .  
82  DAX is a cloud -based service that uses sensors around a doctor’s office or examination room to passively 
record doctor -patient conversations and automatically turn them in to structured medical notes that can be 
entered directly into a patient’s medical record. It therefore differs from Nuance’s existing products which 
are based on the doctor speaking directly to the transcription software to prepare notes or complete an 
electronic health record.  
83 Form CO, Tables 9 and 9A (2020). These market shares are based on installed base and which increases to 
[60-70]% when considering market shared based on new sales.  
84  Form CO, Table 9.  
 
 
22 estimated by the Notifying Party. However, on a worldwide level, its market share is 
significantly highe r between [30-40]%.85  
(105)  The Notifying Party submits that there is no horizontal  overlap because it does not 
offer any standalone transcription software. Instead, Microsoft offers general -
purpose transcription functionalities  as part of Azure Cognitive Servic es, which 
consist of APIs that give access to cloud -based services that developers can integrate 
into their applications  (see paragraph (113)  below) . According to the Notifying 
Party,  these  APIs are not suitable for use in the specialised healthcare environment.86 
Microsoft submits that Azure Cognitive Services do not focus on healthcare 
providers, and therefore lack the medical vocabulary that Nuance’s products have. 
Finally, Azure Cognitive Services also do not a llow customers to dictate into an 
EHR.87 In addition, while  Nuance’s Dragon Medical products would be out-of-the-
box solutions that healthcare customers can use to dictate their medical notes into the 
EHR, Azure Cognitive Services would target developers an d must be integrated by 
the developer into an application before they can be used by healthcare customers.  
(106)  The majority of respondents to the market investigation considered that in the area of 
transcription software for healthcare either the Parties do not compete at all or the 
Parties do not closely compete .88 These respondents note  that Microsoft offers API s 
(components), while Nuance offers out -of-the-box (finished) standalone products. 
Further, these respondents also note that, unlike Microsoft’s gener al STT 
capabilities, Nuance products are specialised healthcare transcription software 
solutions.89 Two respondents finally also specifically clarified  that the customers of 
Nuance’s specialised medical solutions would generally not purchase Microsoft’s 
general transcription services.90  
(107)  On the one hand, to the extent that Microsoft’s APIs and Nuance’s out -of-the-box 
solutions are considered as part of separate relevant markets, the Transaction would 
not lead to a horizontal overlap between the Parties. On th e other hand, if 
Microsoft’s APIs and Nuance’s out -of-the-box solutions are considered as part of the 
same relevant transcription software for the healthcare market, the Transaction 
would lead to a horizontal overlap. However, in the latter case, the Commi ssion 
considers that the Microsoft and Nuance products are not closely competing with 
each other .  
(108)  First, a s set out in paragraph (105)  above, Microsoft’s Azure  Cognitive Ser vices do 
not focus on healthcare provi ders and therefore lack the speciali sed medical 
                                                 
85  Form CO, Table 9A.  
86  Form CO, paragraph 1 58. 
87  Form CO, paragraph 158.  
88  Q1 – Questionnaire to competitors for transcription software, replies to question 24, Q2 - Questionnaire to 
customers for transcription software, replies to question 19, Q3 – Questionnaire to competitors for cloud 
services , replies to question 14, and Q4 – Questionnaire to competitors for communication platforms, 
replies to question 15.  
89  Q1 – Questionnaire to competitors for transcription software, replies to question 24, Q2 - Questionnaire to 
customers for transcription software, replies to question 19, Q3 – Questionnaire to competitors for cloud 
services, replies to question 14, and Q4 – Questionnaire to competitors for communication platforms, 
replies to question 15.  
90  Q1 – Questionnaire to competitors for transcriptio n software, replies to question 24, Q2 - Questionnaire to 
customers for transcription software, replies to question 19.  
 
 
23 vocabulary or integrations with EHR that Nuance’s products have. This specialised 
medical vocabulary is essential for patient safety and the success of the product as 
transcription errors require manual corre ctions and therefore, if numerous, defy the 
purpose of using transcription software in the first place. In addition, some errors 
might even lead to medical mistakes , e.g., in case of prescribed medication . Further, 
Azure Cognitive Services do not allow cus tomers to dictate into an EHR. As such, 
Microsoft’s general -purpose APIs for developers do not compete with Nuance’s 
highly specialised out -of-the-box medical products.   
(109)  Second, in any event, the Notifying Party submits that its estimated market share in 
the market for transcription software for healthcare amounts to close to 0% both at 
worldwide and EEA -level.91 This market share is based on Microsoft’s Azure 
Cognitive Services’ revenues with healthcare customers which amounted to 
approximately [...] in 202 0 worldwide.92 Accordingly, the Transaction would only 
give rise to a negligible  or no  increment  at all.   
(110)  Finally , as set out in paragraph (104)  above, the Notifying Party estimates that the 
total penetration rate  of transcription software for healthcare in 2020 in the EEA is 
between [10-20]%. In this space, large competitors are present such as Recognosco 
(Nuance’s largest EEA competitor ) [...]93, MediaInterface (the third largest EEA 
competitor), 3M/M*Modal and ot her providers (such as Epro and Vocalis, each 
accounting for approximately [0-5]% of the total EEA market, as well as new 
entrants that collectively account for approximately [0-5]%, e.g., Amazon Transcribe 
Medical (in partnership with EHR provider Cerner)  and Inscripta).94  Therefore, even 
if a horizontal overlap exists, the Parties do not exercise a significant competitive 
constraint on each other.  
(111)  In light of the above considerations, the Commission concludes that the Transaction 
does not lead to an affected market in the market for transcription software for 
healthcare, and therefore does not raise serious doubts as to its compatibility with the 
internal market.  
5.1.2.  Transcription  software outside healthcare   
(112)  Outside healthcare, Nuance offers standalone tran scription software for consumers, 
professionals and certain other specific industries such as legal and law enforcement.  
[explanation of Nuance’s market positioning in professional and consumer 
transcription software] .95  Almost all of Nuance products outs ide healthcare are out -
of-the-box products for end -users. Even though Nuance does offer a Dragon SDK 
enabling developers to integrate Nuance’s transcription technology into their own 
applications, [indication of market performance of the product] . 
(113)  Microsof t integrated transcription functionalities in a number of its products : (i) 
APIs as part of Microsoft Azure to allow developers to integrate general purpose 
                                                 
91  Response to RFI 10, Table 3.  
92  The Notifying Party maintains that, even if the Commission were to consider that Azure Cognitive 
Services belongs to the market for transcription software, [...]. See Response to RFI 10, paragraphs 8 -9.  
93  Form CO, paragraph 370.  
94  Form CO, paragraph 370.  
95  Form CO, paragraphs 20 and 173. Annex 15.4 to the Form CO (dated June 2020) shows [indication of  
market performance of the product] . 
 
 
24 transcription into their applications; (ii) dictation functionality incorporated into 
Microsoft 365  (i.e., Word, Outlook, PowerPoint, etc .); (iii) transcription 
functionality incorporated into Teams; (iv) voice recognition built into Windows OS 
to allow voice control of the system (see below Section  5.1.3  regarding accessibility 
solutions).  
(114)  On the market for transcription software outside healthcare, Nuance would have a 
market share of [0-5]% in the EEA  and [0-5]% worldwide96, and Microsoft an EEA 
and worldwide share of less than [0-5]% for the APIs for transcr iption software sold 
through Azure  (2020) .97 Microsoft submits that it is not able to calculate a market 
share that includes the transcription services sold as part of Microsoft 365, Teams or 
Windows OS. Whilst both Parties are offering products with transc ription  
functionality (i.e. transforming speech to text), the Notifying Party argues that 
Microsoft and Nuance do not compete as: (i) Nuance’s products are predominantly 
finished, out -of-the-box solutions, whereas the Azure APIs require input from a 
develo per to create a finished product; and (ii) Nuance’s products are sold 
separately, whereas the functionalities of Microsoft 365, Teams and Windows OS 
are part of the respective software,  meaning that there is no price competition.  
(115)  The majority of responden ts to the market investigation considered that in the area of 
transcription software outside healthcare the Parties either do not compete or do not 
compete closely .98 Respondents noted that Microsoft includes speech recognition as 
part of a bundle with Offi ce, whereas Nuance has separate standalone products. The 
products of the Parties would be  sold in a different manner, with different 
functionalities and different price levels.99 Similarly, the majority of respondents to 
the market investigation considered that, when considering transcription software 
components such as STT, NLU and TTS modules in the area of transcription 
software outside healthcare,  the Parties either do not compete or do not compete 
closely  both have products.100 
(116)  On the one hand, to the ext ent that Microsoft’s APIs and Nuance’s out -of-the-box 
solutions are considered as part of separate relevant markets, the Transaction would 
not lead to a horizontal overlap between the Parties. On the other hand, if 
Microsoft’s APIs and Nuance’s out -of-the-box solutions are considered as part of the 
same relevant transcription software outside  healthcare market, the Transaction 
would lead to a horizontal overlap. However, in the latter case, the Commission 
considers that the Microsoft and Nuance products are  not closely competing with 
each other, and in any event, Nuance and Microsoft would have  very limited market 
share s as set out in paragraph (114) above . Therefore, even if a horizontal overlap 
                                                 
96  Form CO, paragraphs 451, 453 and Tables 11 -11A.  
97  Form CO, paragraph 458  and Response to RFI 10, Table 3 . 
98  Q1 – Questionnaire to competitors for transcription software, replies to question 25; Q2 - Questionnaire t o 
customers for transcription software, replies to question 20; Q3 – Questionnaire to competitors for cloud 
services, replies to question 15; and Q4 – Questionnaire to competitors for communication platforms, 
replies to question 16.  
99  Q2 - Questionnaire to customers for transcription software, replies to question 20.  
100  Q1 – Questionnaire to competitors for transcription software, replies to question 26; Q2 - Questionnaire to 
customers for transcription software, replies to question 21; Q3 – Questionnaire  to competitors for cloud 
services, replies to question 16; and Q4 – Questionnaire to competitors for communication platforms, 
replies to question 17.  
 
 
25 exists, the Partie s do not exercise a significant competitive constraint on each other. 
Finally, and in any event, these market shares do not give rise to an affected market.  
(117)  In light of the above considerations, the Commission concludes that, the Transaction 
does not lead  to an affected market in the market for transcription software outside 
of healthcare, and therefore does not raise serious doubts as to its compatibility with 
the internal market.  
5.1.3.  Accessibility   
(118)  Even if the product market definition is left open and tran scription software used for 
accessibility purposes is considered as a separate product market, the Transaction 
does not lead to competition concerns.  
(119)  Nuance transcription products can also be used to control a PC’s operating system 
and applications by cust omers with vision, hearing, mobility or cognitive function 
impairments. In particular, Nuance offers accessibility functionalities to professional 
and consumers through its Dragon  P&C line of business.  As set out in paragraph 
(112)  above, [indication of market performance of the product] .  
(120)  Microsoft offers accessibility functionalities within its productivity software 
Microsoft 365 and its Windows OS. [...]. 
(121)  The Commission considers that the Parties ’ activities in  accessibility software do not 
lead to a horizontal overlap, due to the fact that only Nuance offers a standalone 
solution . Microsoft , instead,  offers accessibility solutions as an added feature to its 
Windows OS, the Microsoft 365 productivity software.101  
(122)  Even if one were to consider Microsoft’s accessibility functions as competing with 
Nuance, [indication of the market positioning and strategy associated to Nuance ’s 
product]102 103 104 105.  
(123)  In light of the above considerations, the Commission concludes that, reg ardless of 
the exact market definition adopted, the Transaction does not lead to affected 
markets in a potential market for accessibility software, and therefore does not raise 
serious doubts as to its compatibility with the internal market.  
                                                 
101  As evidence of the fact that standalone, specialist solutions and consumer hardware and software offer ing 
accessibility features do not compete with each other, the Notifying Party refers to both a CMA Final 
Report (Completed acquisition by Tobii AB of Smartbox Assistive Technologies Limited and Sensory 
Software International Ltd Final report 15 August 201 9, para 5.40.) and a report by AbilityNet 
(https://abilitynet.org.uk/factsheets/voice -recognition -overview ). In particular, the CMA found that, while 
Google, Microsoft and Appl e seek to make their OS as accessible as possible, “ meeting the specialised 
needs of users of dedicated  [accessibility] solutions is not their focus, and they tend not to see themselves 
as competing directly with suppliers of dedicated  [accessibility] solutions ”. See, Form CO, paragraph 288.  
102  Form CO, paragraphs 171 ss. Reply to RFI 5, reply to question 7.  
103 Reply to RFI 5, reply to questions 7 and 9.  
104 Reply to RFI 5, paragraph 9.2. The Notifying Party explains that, because viruses and other malware 
threats have become more sophisticated, OK providers have had to improve OS security from the base 
system upwards. Oss have therefore restricted opportunities to access certain base system level resources 
and unfortunately thereby also reduced access for acc essibility vendors [DETAILS OF COMMERCIAL 
OR INVESTMENT STRATEGY ]. 
105 Reply to RFI 5, reply to question 4, paragraphs 15 and 16. [...] 
 
 
26 5.2. Vertical relat ionship  
(124)  Depending on the market definition, t he Transaction results in one vertically affected 
market :  
(a) Upstream: Microsoft’s cloud services and data analytics  (EEA: [20-30]%; 
Global: [10-20]%)106; and  
(b) Downstream: Nuance’s transcription software for healthc are (EEA: [60-
70]%; Global: [50-60]%)107. 
(125)  When considering this vertical relationship with all other segments of transcription 
software, including transcription software outside of healthcare  or an overall market 
for transcription software , no vertically aff ected market arises as neither party has a 
market share in excess of 30% in either the upstream or downstream market.  
5.2.1.  Possible foreclosure of competing healthcare transcription providers by restricting 
access to Microsoft’s cloud services and data analytic s (input foreclosure ) 
(126)  The Commission’s  market investigation indicates that today, the majority of 
healthcare software in the EEA, including electronic healthcare records and 
transcription software are hosted “on -premises”, that is on servers owned and 
mana ged by the he althcare providers.108 There does  appear however to be a trend 
towards moving these services to the cloud where the data and software would be 
hosted on servers owned and managed by cloud providers. The technology research 
and consulting company  Gartner forecasted that worldwide spending on public cloud 
would increase by 18% in 2021 (compared to 2020), driven by enterprise spending 
on switching from on -premises solutions to cloud -based solutions.109 This is 
reflected in the results of the market in vestigation with many respondents reporting 
that there is an increasing trend of hospitals moving to the cloud, including for their 
healthcare transcription software.110 This indicates that cloud services are likely to 
become an increasingly important input for the provision of transcription software 
for the healthcare sector  as well . 
(127)  In Europe, Nuance currently offers it s services on -premises, or hosted on Microsoft ’s 
cloud  platform .111 Hosting Nuance’s services on other cloud platforms is not 
currently possib le. 
                                                 
106  Form CO, paragraphs 563 and 573, Tables 23 and 23A. These figures include both IaaS and PaaS.  
107  Form CO, Tables 9 and  9A. These market shares are based on installed base and which increases to [60-
70]% when considering market shared based on new sales.  
108  Minutes of call dated 17 September 2021, Doc ID 174; Minutes of call dated 17 September 2021, Doc ID 
291; Minutes of  call dated 7 October 2021, Doc ID 569. 
109  See https://www.gartner.com/en/newsroom/press -releases/2020 -11-17-gartner -forecasts -worldwide -
public -cloud -end-user-spending -to-grow -18-percent -in-2021. Form CO, paragraphs 635 -639. 
110  Minutes of call dated 17 September 2021, Doc ID 291; Minutes of call dated 13 September 2021, Doc ID 
346; Minutes of cal l dated 7 October 2021, Doc ID 569. 
111  Form CO, paragraphs 7 and 30.  
 
 
27 5.2.1.1.  The Notifying Party’s views  
(128)  The Notifying Party  argues that it would not have the ability or the incentive to 
foreclose competing healthcare transcription providers by restricting access to its 
cloud services for the following reasons.  
(A) Ability to engag e in input foreclosure  
(129)  The Notifying Party  submits that it does not have the ability to foreclose Nuance’s 
rivals with regard to cloud computing solutions because it  does not have market 
power with regard to cloud computing.112 It submits that in the event t hat Microsoft 
restricts access to its cloud services, competing transcription providers could switch 
to other cloud providers such as Amazon, Google  and IBM.   
(B) Incentive to engage in input foreclosure  
(130)  The Notifying Party  submits that it does not have an incentive to foreclose Nuance’s 
rivals with regard to cloud computing solutions  as its Azure platform was built as an 
open, extensible and neutral cloud platform and that attempts to foreclos e rivals 
would not only result in a direct loss of revenues but also  a loss of trust in the 
platform .113  
5.2.1.2.  The Commission’s assessment  
(A) Ability to engage in input foreclosure  
(131)  The Commission considers that post -Transaction  the merged entity  would  not have 
the ability to foreclose Nuance’s rivals through either preventing access  to its cloud 
computing services or otherwise degrading the conditions on which it supplies its 
cloud computing services, for the following reasons.  
(132)  First, the Commission notes that while Microsoft is an important supplier of cloud 
computing services, ther e are other players that will continue to provide cloud 
services post -Transaction. In pa rticular, in 2019, Microsoft had  a worldwide market 
share of [10-20]% behind Amazo n with a market share of [30-40]%, with multiple 
other providers such as Google ( [0-5]%), Alibaba ( [0-5]%) and IBM ( [0-5]%) also 
active on the market . In 2020, Microsoft had , according to its own estimate,  a 
worldwide market share of [10-20]% and [10 -20]%  in the EEA behind Amazon 
([30-40]% worldwide and [30-40]% in the EEA, with Google, Ali baba and IBM also 
active on the market.  
                                                 
112  Form CO, paragraph 563.  
113  Form CO, paragraphs 569 -570. 

 
 
29 plus taking into account that Microsoft is active in many different downstream 
markets, a strategy to foreclose competing transcription providers in healthcare could 
have a negative impact on its  cloud revenues from third parties that compete with 
Microsoft in other markets.  This is in the context of the volume of revenues that 
Microsoft stands to obtain from deploying Azure in the healthcare sector being  
materially higher than those from healthca re transcription software are . Microsoft 
submits that by 2023, the total annual spend in digital transformation  (i.e. cloud -
based solutions, encompassing cloud PaaS, IaaS and SaaS)  across healthcare 
providers worldwide will amount to [...]117 with tr anscrip tion software comprising  
[Less than [10-20]%] of that market.  
(138)  Second, the majority of the respondents to the market investigation did not consider 
that Microsoft would have the incentive to prevent rival transcription providers from 
using its cloud servic es, or otherwise deteriorate the conditions under which it 
provides the se services , noting  that: “ Rival transcription software providers have 
alternatives like Alibaba Cloud and AWS. Microsoft would not be able to benefit 
itself by preventing them from usi ng its cloud services ”.118  
(139)  Third, Microsoft’s internal documents support its argument that its Azure platform 
was built as an open, extensible and neutral cloud platform.  For example, a 
Microsoft memo to the Board of Directors  states that: [...].119 This is a lso consistent 
with the findings of the Commission in relation to non -horizontal foreclosure 
concern s of competing providers of IaaS / PaaS in its Microsoft / Github  decision : 
“Microsoft’s intention is to cater for the needs of developers, first among all 
openness and freedom of choice ”.120 
(C) Impact on effective competition  
(140)  Given the existence of multiple alternative cloud providers to which transcription 
software providers could switch , the Commission considers that there would only be 
a limited impact on effe ctive competition  if Microsoft were to pursue a foreclosure 
strategy . 
(141)  This conclusion is consistent with the results of the market investigation , in which  
the majority of respondents considered that the Transaction would have a neutral 
effect on their busi ness, including with regard to the supply and purchase of cloud 
computing services.121 
                                                 
117  See Form CO, Annex 5.0.37. [MICROSOFT INTERNAL DOCUMENT] , as well as the Notifying Party’s 
response of 16 December 2021 to Q6 of RFI 10  
118  Q1 – Questionnaire to competitors for tran scription software, replies to question 30; Q3 – Questionnaire to 
competitors for transcription software, replies to question 19.  
119  See Form CO, Annex 5.0.37.  [MICROSOFT INTERNAL DOCUMENT].   
120  Commission decision of 19 October 2018 in case M.8994 - Micro soft/GitHub , para. 126.  
121  Q1 – Questionnaire to competitors for transcription software, replies to questions 41 and 41.1; Q2 – 
Questionnaire to customers for transcription software, replies to questions 30 and 30.1; Q3 – 
Questionnaire to competitors for c loud services, replies to questions 20 and 23; and Q4 – Questionnaire to 
competitors for communication platforms, replies to question 24.  
 
 
30 (D) Conclusion  
(142)  For the reasons set out above, the Commission considers that the Transaction will 
not raise serious doubts as to the compatibility with the internal market with  respect  
to a possible foreclosure of competing healthcare transcription providers by 
restricting access to Microsoft’s cloud services  and data analytics , regardless of the 
exact product market definition retained  for transcription software , either on a 
worldwide or EEA -wide basis.  
5.2.2.  Possible foreclosure of competing cloud providers by restricting access to Nuance 
as customer  (customer foreclosure ) 
5.2.2.1.  The Notifying Party’s views  
(143)  The Notifying Party submits that it would  have  neither  the ability nor the   incent ive 
to engage in a customer foreclosure strategy with regard to cloud computing for 
healthcare transcription as: (i) [[...] the transaction  will not cause any rival cloud 
provider to lose a significant customer ]; and (ii) Nuance is not an “important 
custom er” for providers of cloud services pursuant to the Commission’s Non -
horizontal Merger guidelines.122   
5.2.2.2.  The Commission’s assessment  
(144)  For the reasons set out below, the Commission  conside rs that post -Transaction the 
merged entity  would  have  neither  the abilit y nor the incentive  to foreclose its cloud 
rivals by adopting a customer foreclosure strategy.  
(145)  First, [the merged entity would not have the ability to foreclose its rivals as [...]. 
Competitors to Microsoft are therefore not relying today on Nuance as a cu stomer 
and the merger -specific effects of the Transaction with regard to Nuance as a 
customer of cloud  services are therefore limited] .  
(146)  Second , the merged entity would not have incentives to foreclose its rivals. Even 
taking into account the projected shi ft of healthcare transcription services to the 
cloud, Nuance would not constitute an important customer for cloud services. In 
2020, Microsoft’s Azure revenues from the total services provided to Nuance 
amounted to [...], which is [0-5]% of Microsoft’s wor ldwide revenues from Azure 
cloud services of [...] with a total market size estimated by the Notifying Party to be 
[...] worldwide and [...] in the EEA. Nuance cannot therefore be considered as an 
important customer for cloud services and data analytics . 
(147)  Third, given that the merged entity  is unlikely to have the ability or incentives to 
engage in a customer foreclosure strategy post -Transaction  and [...], the Commission 
considers that there is unlikely to be a negative impact on competition  even if 
Microso ft were to pursue such strategy .  
(148)  In that regard , the majority of competitors in the cloud computing market considered 
that the Transaction would have a neutral effect on their business123 and specifically 
                                                 
122  Form CO, paragraphs 572 – 574 and the Notifying Party’s response to Q12 of RFI 8, submitted on 8 
December 2021.  
123  Q3 – Questionnaire to competitors for cloud services, replies to question 20  
 
 
31 with regard to their ability to supply cloud computi ng services.124 As noted above, 
one cloud computing customer had concerns regarding this vertical relationship  (see 
paragraph (135) ), including that Microsoft may offer Nuance’s voice recognition 
technology to cust omers under the condition that they must use Microsoft’s cloud 
services, thereby excluding competing cloud service providers . However, in light of 
the foregoing reasons, and since this respondent provided no arguments to support 
its position, the Commissio n does not consider  that Microsoft would have the ability 
or incentive to adopt a strategy to foreclose competing cloud service providers . 
(149)  For the reasons set out above, the Commission considers that the Transaction will 
not raise serious doubts as to the compatibility with the internal market with respect 
to possible foreclosure practices of competing healthcare transcription providers by 
restricting access to Nuance  as a customer  for cloud services and data analytics , 
regardless of the exact product marke t definition retained  for transcription services , 
either on a worldwide or EEA -wide basis.   
5.2.3.  Possible foreclosure effects in relation to Nuance’s medical data (input 
foreclosure)  
(150)  Nuance processes speech data, which it uses to train its algorithms and improv e the 
accuracy of  its offerings. The data consist of audio recordings and related transcripts.  
To the Commission’s knowledge, there is no market for such data since it is not 
traded by any company. In any case, Nuance does not make such data available to 
third parties and is therefore not active on such market if it were to exist.  
(151)  Therefore, from a competition perspective, there is no market in relation to Nuance’s 
medical data that could be affected by the Transaction. However, the Commission 
nonetheless a ssessed a potential foreclosure strategy by the merged entity following 
the Transaction.  
5.2.3.1.  The Notifying Party’s view  
(152)  The Notifying Party observes that competition concerns may arise when two large, 
unique and competitively significant datasets are combined . However, t he 
Transaction would entail no such combination. Nuance’s customer data consists 
primarily of medical speech data, which is an area where Microsoft has a very 
limited presence and acce ss to comparatively little data, as confirmed by [...]. 
More over, as explained further below, the usage that can be made of Nuance’s 
healthcare data  is limited by contractual restrictions and data protection 
regulations.125 
(153)  [...]. Therefore, the Notifying Party submits that no company depends on that data to 
compete effectively, and input foreclosure concerns can be excluded.  
                                                 
124  Q3 – Questionnaire to competitors for cloud services, replies to question 23  
125  Form CO, paragraphs 576 -578. 
 
 
32 5.2.3.2.  The Commission’s assessment  
(154)  The Commission preliminarily observes  that, according to paragraph 36 of the 
Horizontal Merger Guidelines,126 a merger can  significantly impede effective 
competition if the merged entity gains such a degree  of control over an asset that 
expansion or entry by rival firms may be more difficult.  
(155)  In that respect, as set out in Apple/Shazam , the Commission notes that there are 
certain regulatory limitations to prevent the ille gal combination of datasets.127 
(156)  First, as regards the ability to foreclose the data,  the Commission recalls that the 
processing of personal data is subject to the applicable EU rules dealing with data 
protection, and most notably to the Regulation (EU) 2016/ 679 of the European 
Parliament and of the Council128 (“GDPR”). Such rules apply to personal data, that 
is "any information relating to an identified or identifiable natural person  (‘data 
subject’); an identifiable natural person is one who can be identified,  directly or 
indirectly, in particular by reference to an identifier such as a name, an 
identification number, location data, an online identifier or to one or more factors 
specific to the physical, physiological, genetic, mental, economic, cultural or soc ial 
identity of that natural person ".129 
(157)  Pursuant to Article 5(1)(b) GDPR, personal data which has been collected for 
specified, explicit and legitimate purposes may not be further processed in a manner 
that is incompatible with those purposes. Data which qu alifies as personal data under 
the GDPR can be transmitted to and processed by a third party only to the extent that 
there exists a legal basis for the transmission to the third party and a legal basis for 
the processing by that third party.  
(158)  Further, the G DPR requires that individuals concerned by the processing must be 
informed in a transparent manner on all relevant circumstances of the processing, 
including on the identity of each controller and th e purposes of the processing.130 
(159)  Finally, to the extent the  data processing activities concern health data, Article 9 of 
the GDPR provides a general, alth ough not absolute, prohibition.131 
(160)  In the light of the above provisions, the Commission observes that use of Nuance’s 
database of personal health data, however val uable it may be for the  development of 
                                                 
126  Guidelines on the assessment of horizontal mergers under the Cou ncil Regulation on the control of 
concentrations between undertakings, OJ C 31, 5.2.2004, p. 5 –18 
127  Commission decision of 6 September 2018 in case M.8788 – Apple/Shazam,  recitals 225 -235. 
128  Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the 
protection of natural persons with regard to the processing of personal data and on the free movement of 
such data, and repealing Directive 95/46/EC (General Data Protection Regulation) (OJ L 119, 4.5.2016, p. 
1). In this De cision, the Commission discusses the rules under that Regulation only for the purposes of the 
assessment the Transaction under the Merger Regulation. The analysis in this Section is therefore entirely 
without prejudice to the relevant administrative or leg al procedures where the Parties' compliance with 
those rules may be assessed.  
129  Article 4 of the GDPR.  
130  Article 5 of the GDPR.  
131  Article 9(1) GDPR provides that “Processing of […] data concerning health […] shall be prohibited”. 
However, this general p rohibition does not apply, upon the occurrence of one of the exceptions provided 
for in Article 9(2), including the case where the user has given consent to the data processing.  
 
 
33 transcription software or other products and services, may only take place within the 
boundaries of, and in compliance with, such data protection rules.  
(161)  In addition, [...].132 
(162)  Even if such contractual and regulatory pro vision s were not in place,  and the merged 
entity could freely dispose of such data assets,  the market investigation has 
confirmed that Nuance’s database is not an important input  in any downstream 
market where data could be used to develop data -driven tech nology (e.g. ambient 
transcription software) . In fact, customers of transcription software responding to the 
market investigation have indicated that they do not rely on Nuance for access to 
medical data. Some in fact have explained  that they rec eive from Nuance  ready -to-
use transcription software and do not need any data to install and operate it. Other, 
who need data to “train” their speech recognition software, obtain such data from 
their healthcare customers or partners.133 
(163)  The Commission considers that, as indicated by the Notifying Party, before the 
Transaction, [...]. Therefore, there is no such party that might be dependent on access 
to such database and could be potentially harmed by the Transaction.  However, even 
if this would not be  the case, the Co mmission considers that Nuance would lack the 
ability (including the legal ability) to foreclose such data  for the reasons explained 
above. As to legal ability  (i) Nuance’s partners would have to obtain their patients’ 
consent (or alternative legal basis u nder relevant data protection laws) in orde r to 
make their medical data available for software development purposes;  (ii) the 
contracts between Nuance and its partners would have to provide for a transfer of 
data, not only to Nuance, but to third parties N uance c ould possibly transfer the data. 
As to the importance of the input,  third parties would need to rely on such medical 
data for the development of their software (while at the moment they either don’t 
need the data or obtain it from other sources) . As the requirements to prove the risk 
of foreclosure are cumulative, there is no need for the Commission to discuss the 
merged entity’s incentive to engage in foreclosure and the impact on competition 
thereof.  
(164)  For the reasons set out above , the Commission co nsiders that the Transaction will 
not raise serious doubts as to the compatibility with the internal market with respect 
to the use of Nuance data and its possible foreclosure .         
5.3. Conglomerate relationships  
5.3.1.  Nuance’s transcription software for healthca re and Microsoft’s enterprise 
communication services  
(165)  These activities give rise to an affected market given that the Parties are active in 
neighbouring markets and Nuance’s market share exceeds 30%:  
                                                 
132  Form CO, paragraphs 591 -595. [...].  
133  Q2 – Questionnaire to customers for  transcription services, replies to question 18.  
 
 
34 (a) Nuance’s transcription software for healthcare (EEA: [60-70]%; Global: [50-
60]%);134 and  
(b) Microsoft’s enterprise communication services:  
 Enterprise communication services: EEA: [20-30]%135; Global: [10-
20]%136.  
 Enterprise communication services  in the healthcare sector: EEA: [5-
10]%137; Global: [5-10]%138.  
(166)  As noted abov e in para graphs  (103)  and (266)  Nuance’s transcription software 
enables doctors to convert their speech into text for example to complete forms and 
medical records. In partnership with Microsoft, Nuance  recently developed DAX. 
DAX is a cloud -based service that uses sensors around a doctor’s office or 
examination room to passively record doctor -patient conversations and automatically 
turn them into structured medical note s that can be entered directly into a patient’s 
medical record. It therefore differs from Nuance’s existing products which are based 
on the doctor speaking directly to the transcription software  to prepare notes or 
complete an electronic health record . DAX  is currently being launched in the USA 
and is not currently available in the EEA.  
(167)  In September 2020, the Parties announced that DAX will be available for integration 
with Microsoft Teams . A conglomerate relationship therefore exists between 
Nuance’s heal thcare transcription activities and Microsoft’s enterprise 
communication services , in particular in relation to providing virtual healthcare 
visits.    
5.3.1.1.  Possible foreclosure of competing enterprise communication providers for virtual 
healthcare visits by restricting or degrading  access to Nuance’s transcription 
services  for healthcare  
(A) The Notifying Party’s views  
(168)  The Notifying Party  argues that it would have neither the ability nor the incentive to 
exclude competing communication service providers from providi ng virtual 
                                                 
134  These market shares are based on installed base and which increases to [60-70]% when considering 
market shared based on new sales.  
135 Response to RFI 7, question 9. This represents Teams plus Skype for Bu siness, including both cloud and 
on-premise solutions.  
136  Form CO, paragraphs 403 -405. Microsoft’s global share in enterprise communication services, including 
both Teams and Skype for Business is [10-20]%, and [10-20]% when Skype for Business On -premises is 
included.  See also Form CO, paragraph 385 regarding Microsoft Teams’ EEA and worldwide share 
specifically: Microsoft’s best estimate for Microsoft Teams’ share in enterprise / unified communication 
services worldwide is [10-20]%, in Europe [10-20]%. Thi s market share is based on the number of 
monthly active users of Microsoft Teams against the total number of licenses for enterprise 
communication services.  The Commission has not reached out to the market in order to verify the 
methodology and computatio ns underlying the market shares provided by Microsoft.  
137 Response to RFI 7, question 11.  
138  Response to RFI 7, question 11. This figure represents the market share for the UK + US + Europe which 
the Notifying Party estimates to represents [80-90]% of globa l market for enterprise communication 
services for healthcare applications.  
 
 
35 healthcare visits by limiting / preventing integration with  Nuance’s transcription 
software for healthcare solutions . 
(A.i) Ability to engage in foreclosure  
(169)  The Notifying Party  submits that post -Transaction it would not have the ability to 
foreclose  rival enterprise communication services  providers for the following 
reasons.  
(170)  First, t he Notifying Party submits that t ranscription technology is not a necessary 
feature for a video communication service provider to compete effectively in 
healthcare. Rather,  factors such as quality of video, security, integration with the 
physician’s workflow are the key drivers of customer choice for virtual consultation 
platforms . 
(171)  Second, the Notifying Party submits that physicians can still use DAX with a 
competing communi cation plat forms even if there is no full  integration (e.g., by 
placing a device with the mobile application near their PC ). 
(172)  Third, the Notifying Party considers that sufficient alternatives to DAX exist such as 
the Amazon Transcribe Healthcare APIs and Su ki. Others would have the capability 
to enter the market, such as 3M/M*Modal and Google , that competing enterprise 
communication providers could integrate with . 
(A.ii) Incentive to engage in foreclosure  
(173)  The Notifying Party  submits that DAX is core to the Transact ion rationale and that it 
will have the incentive to ensure the wide adoption of DAX by allowing integration 
with other communication systems.  Through the Transaction, it aims to become a 
trusted partner for physicians and healthcare providers and denying such integration 
would run counter to the Transaction rationale.  
(174)  The Notifying Party  also submits that  it would not make economic sense to sacrifice 
DAX revenues in order to drive sales to Teams when Teams already has high 
adoption rates amongst healthcare  providers through incorporation in Office 365 and 
that the Office 365 suites that include Teams are much cheaper than DAX . While the 
potential revenue loss from an exclusivity strategy would be significant since DAX 
is a high -priced product with significa nt growth potential in the healthcare sector, the 
potential gains from cross selling of Office 365 would likely be minimal.  
(B) The Commission’s assessment  
(B.i) Ability to engage in foreclosure  
(175)  The Commission considers that post -Transaction , the merged entity  would  not have 
the ability to foreclose its enterprise communication providers rivals through either 
preventing access to Nuance’s DAX service or otherwise degrading the conditions 
on which it supplies DAX, for the following reasons.  
(176)  Contrary to the submissions  of the Parties, the results of the market investigation 
indicated that the incorporation of a transcription service into a telehealth 
 
 
36 communications platform would be important to the competitive success of the 
telehealth platform.139 
(177)  This said, [...], both  in terms of timeframe and likely adoption rates. Based on 
information provided by the Parties, [...]. [...], the current adoption rates of Nuance’s 
existing medical transcription software in the EEA (around [...]) does not clearly 
indicate that [...] it would achieve a position that gives Microsoft any ability to 
foreclose rival telehealth communication providers in any relevant time frame.  
(B.ii) Incentive to engage in foreclosure  
(178)  The Commission considers that post -Transaction the merged entity  would not have 
the incentive to foreclose its enterprise communication provider rivals through either 
preventing access to Nuance’s DAX service or otherwise degrading the conditions 
on which it supplies DAX, for the following reasons.  
(179)  First, the margins that Microsoft stan ds to lose by withholding DAX are far higher 
than the margins that it would gain by increased sales of Teams.  
(180)  In the US, DAX is currently sold at approximately [...] with expected margins of c. 
[...] by FY25. Teams is included with Microsoft/Office 365, w hich is priced from 
USD 96 to 684 per user/year in the US and EUR [...] to [...] per user/year in Europe 
depending on the package. By adopting a foreclosure strategy, Microsoft would lose 
DAX sales in exchange for the possibility of increasing sales of Mic rosoft/Office 
365, a product that at most generates only [5-10]% the revenue generated by DAX 
annually. Microsoft therefore has an incentive to ensure DAX works with as many 
other pieces of speciali sed healthcare/telehealth software as possible to ensure b road 
distribution of DAX.  This is further reinforced by the revenues that Microsoft would 
obtain as a result of DAX running on the Azure platform.  
(181)  Second, the majority of respondents to the market investigation did not consider that 
Microsoft would have th e incentive to foreclose rival healthcare transcription 
providers through preventing access to Teams.140 
(B.iii)  Impact on effective competition  
(182)  Given [...] and the merged entity’ s likely  lack of incentive to engage in such a 
foreclosure strategy, the Commission con siders that there would be a limited impact 
on effective competition.  
(183)  This conclusion is consistent with the results of the market investigation in which the 
majority of respondents considered that the Transaction would have a neutral effect 
on their busin ess, including with regard to the supply of enterprise communication 
software and the supply of communication software for virtual healthcare visits.141 
                                                 
139  Q4 – Questionnaire to competitors for communications platforms, replies to question 19.  
140  Q2 – Questionnaire to customers for transcription software, replies to question 22.   
141  Q1 – Questionnaire to competitors for transcription software, replies to questions 41 and 41.1; Q2 – 
Questionnaire to customers for transcription software, replies to questions 30 and 30.1; Q3 – 
Questionnaire to competitors for cloud services, replies t o question 20; and Q4 – Questionnaire to 
competitors for communication platforms, replies to questions 27 and 28.  
 
 
37 (B.iv)  Conclusion  
(184)  For the reasons set out above, the Commission considers that the Transaction will 
not raise se rious doubts as to  the compatibility with the internal market with respect 
to possible  foreclosure of competing enterprise communication providers for virtual 
healthcare visits by restricting or degrading access to Nuance’s transcription services 
for heal thcare  either on a worldwide or EEA -wide basis . 
5.3.1.2.  Possible foreclosure of competing healthcare transcription providers by restricting  
or degrading access to Microsoft’s enterprise communication services  for virtual 
healthcare visits  
(A) The Notifying Party’s vie ws 
(185)  The Notifying Party  argues that it would have neither the ability nor the incentive to 
exclude competing healthcare transcription providers by restricting access to Teams .  
(A.i) Ability to engage in foreclosure  
(186)  First, the Notifying Party submits that Teams i s not a leading provider in 
communication services for virtual healthcare visits and there are multiple 
competitors, both general communication providers such as WebEx, Zoom and 
Google Meet as well as specialist telehealthcare providers. Moreover, Amazon a nd 
BlueJeans have recently announced the launch of specialist telehealth platforms that 
include  video conferencing . 
(187)  Second , the Notifying Party considers that competing rivals can integrate into Teams 
using publicly available APIs without any input from Mi crosoft.  
(188)  Third, DAX is the only ambient clinical intelligence provider that integrates with 
Team pre -Transaction and therefore, the Transaction would not deprive rivals of an 
integration that exists pre -Transaction.  
(189)  Fourth, the Notifying Party asserts that  the main application of DAX and its rivals 
will be for in -person visits rather than virtual consultations; therefore, integration 
with a video platform is not an essential input for commercial success.  
(A.ii) Incentive to engage in foreclosure  
(190)  The Notifying Part y submits that it would not have the incentive to foreclose rival 
competing healthcare transcription providers because when application providers 
create integrations with Teams, it makes Teams more valuable to its users. 
Degrading the Teams public APIs to prevent DAX competitors integrating with 
Teams would undermine one of Teams’ central value propositions.  
(B) The Commission’s assessment  
(B.i) Ability to engage in foreclosure  
(191)  The Commission considers that post -Transaction, the merged entity would not have 
the abili ty to foreclose its healthcare transcription rivals through either preventing 
access to Teams or otherwise degrading the conditions on which it makes Teams’ 
APIs available, for the following reasons.  
 
 
38 (192)  First, while Microsoft Teams is an important player in t he market for enterprise 
communication software, this does not necessarily appear to be the case with regard 
to communication software for virtual healthcare visits. According to the 
methodology used by the Notifying Party to calculate its market share for  enterprise 
communication services, it has a share of [20-30]% in the EEA142 and [10-20]% 
globally.143 However , when consider ing the segment for enterprise communication 
services in the healthcare sector this percentage drops to [5-10]% in the EEA144 and 
[5-10]% globally145.   
(193)  The players offering telehealth platforms include existing enterprise communication 
providers offering healthcare specific services and subscription plans (like Zoom for 
healthcare or WebEx for healthcare), other tech companies expanding in t his sector 
at the global level (e.g.,  Amazon Care), existing telehealth providers (e.g ., Teladoc), 
and new providers and start -ups entering thanks to the increased demand for video 
consultations generated by the COVID -19 pandemic (e.g ., accruRx and  eConsu lt). 
the Notifying Party  indicates that the majority of these, including Amazon, Amwell, 
BlueJeans, Cisco, Epic, Google, Teladoc, Vidyo, Vsee, and Zoom are already active 
in the EEA.  
(194)  Accordingly, alternative developers of transcription software will not b e foreclosed 
as, to the extent that inclusion in a telehealth platform is an important route to 
market, there are multiple other players with which they could integrate other than 
Teams.  
(195)  Second, Teams APIs are publicly available for third party app develop ers to be able 
to interoperate  with their healthcare transcription service . The majority of 
respondents to the market investigation confirmed that it would be possible for a 
transcription software provider to integrate its software into Microsoft Teams 
without the assistance of Microsoft.146 
(B.ii)  Incentive to engage in foreclosure  
(196)  The Commission considers that post -Transaction, the merged entity  would not have 
the incentive to foreclose its healthcare transcription rivals through either preventing 
access to Teams  or otherwise degrading the conditions on which it makes Teams’ 
APIs available, for the following reasons.  
                                                 
142 Response to RFI 7, question 9. This represents Teams plus Skype for Business, including both cloud and 
on-premise solutions.  
143  Form CO, par agraphs 403 -405. Microsoft’s global share in enterprise communication services, including 
both Teams and Skype for Business is [10-20]%, and [10-20]% when Skype for Business On -premises is 
included.  See also Form CO, paragraph 385 regarding Microsoft Teams ’ EEA and worldwide share 
specifically: Microsoft’s best estimate for Microsoft Teams’ share in enterprise / unified communication 
services worldwide is [10-20]%, in Europe [10-20]%. This market share is based on the number of 
monthly active users of Micro soft Teams against the total number of licenses for enterprise 
communication services. The Commission has not reached out to the market in order to verify the 
methodology and computations underlying the market shares provided by Microsoft.  
144 Response to R FI 7, question 11.  
145  Response to RFI 7, question 11. This figure represents the market share for the UK + US + Europe which 
the Notifying Party estimates to represents [80-90]% of global market for enterprise communication 
services for healthcare applicat ions.  
146  Q2 – Questionnaire to customers for transcription software, replies to question 20.   
 
 
39 (197)  First, the Notifying Party’s  internal documents evaluating the Transaction indicate 
[...]. 
(198)  Second, the majority of respondents to the market investig ation did not consider that 
Microsoft would have the incentive to foreclose rival healthcare transcription 
providers through preventing access to Teams.147  
(B.iii)  Impact on effective competition  
(199)  Given the existence of multiple alternative communication platform pr oviders with 
whom rival healthcare transcription providers could integrate and the lack of 
incentive to engage in such a foreclosure strategy, the Commission considers that 
there would be a limited impact on effective competition.  
(200)  This conclusion is consis tent with the results of the market investigation in which the 
majority of respondents considered that the Transaction would have a neutral effect 
on their business, including with regard to the  supply of enterprise communication 
software and the supply of  communication software for virtual healthcare visits .148 
(B.iv)  Conclusion  
(201)  For the reasons set out above, the Commission considers that the Transaction will 
not raise serious doubts as to the compatibility with the internal market with respect 
to possible  foreclos ure of competing healthcare transcription providers by restricting 
or degrading access to Microsoft’s enterprise communication services for virtual 
healthcare visits.  
5.3.2.  Nuance’s transcription software outside of healthcare and Microsoft’s productivity 
softwa re suite  
(202)  These activities give rise to an affected market given that the Parties are active in 
neighbouring markets and Microsoft’s market share exceeds 30%:  
(a) Nuance’s transcription software outside of healthcare (EEA: [0-5]%; Global: 
[0-5]%)149 and  
(b) Microso ft’s productivity software suite (EEA: [60-70]%150 ; Global: [50-
60]%151).  
                                                 
147  Q2 – Questionnaire to customers for transcription software, replies to question 25; and Q4 – Questionnaire 
to competitors for enterprise communication softwar e, replies to question 23.   
148  Q1 – Questionnaire to competitors for transcription software, replies to questions 41 and 41.1; Q2 – 
Questionnaire to customers for transcription software, replies to questions 30 and 30.1; Q3 – 
Questionnaire to competitors for cloud services, replies to question 20; and Q4 – Questionnaire to 
competitors for communication platforms, replies to questions 27 and 28.  
149  Form CO, paragraph 462. The Parties submit that these are conservative estimates as they represent only 
transc ription “software” to the exclusion of transcription “services” which would also include SaaS, online 
transcription tools and manual transcription and bring its share down to [0-5]%.  The Commission has not 
reached out to the market in order to verify the methodology and computations underlying the market 
shares provided by Microsoft.  
150  Response to RFI 7, question 9.  
151 Form CO, paragraphs 53, 424 and 462.  
 
 
40 (203)  As noted above in paragraph (3), Nuance’s Dragon P&C integrates with some 
productivity applications, including Microsoft Word, Exc el, Outloo k and 
PowerPoint. The transcription functionality in Office 365  allows users to dictate text 
using their voice into these applications. This gives rise to a conglomerate 
relationship between Nuance’s transcription software outside healthcare and 
Microsoft’ s productivity software.  
5.3.2.1.  Possible foreclosure of competing productivity services providers  by restricting or 
degrading  access to Nuance’s transcription software outside of healthcare  
(A) The Notifying Party’s views  
(204)  The Notifying Party  argues that it would have neither  the ability nor the incentive to 
exclude competing productivity services providers by restricting access to Nuance’s 
transcription products.152 
(A.i) Ability to engage in foreclosure  
(205)  First, according to the Notifying Party, the ability to integrate transc ription software 
does not drive customer -purchasing  decisions with regard to productivity services. 
Instead, the choice of productivity offerings is driven by factors such as ease, 
reliability, security, and interoperability.153  
(206)  Second , Nuance’s transcripti on products have certain functionalities, which  allow 
their use with productivity services even in the absence of full integration.154 Users 
can dictate into a box in the Dragon application (called the “Dictation Box”) and 
then transfer the text from the Dic tation Box to the application of their choice. The 
Dictation Box automatically appears when a user attempts to dictate in an 
unsupported application. For instance, this is how users have been using Dragon 
P&C with Google Workspace as Nuance does not fully support integration between 
Dragon P&C and Google Workspace.  
(207)  According to the Notifying Party, the lack of pre -built integration between Google 
Workspace and Dragon P&C has clearly not affected Google’s ability to compete in 
the market for productivity sof tware. Google is reported to have a market share of 
44.6% worldwide as of May 2021, and likely ranging between 30 -40% in the 
EEA.155 According to Statista,156 Google Workspace paid business customers and 
organizations significantly increased over time passing from approximately 3 million 
in 2017 to more than 6 million in 2020, as reported by Google itself.157 It is apparent 
that integration with a third -party transcription software like Dragon P&C is not a 
competitive driver for productivity software.158 
                                                 
152  Form CO, paragraph 463.  
153  Form CO, paragraph 465.  
154  Form CO, paragraph 466.  
155  See Response to RF I 7, question 9.  
156  See https://www.statista.com/statistics/961008/g -suite -paid-accounts -worldwide .  
157  See https://cloud.google.com/blog/products/g -suite/how -google -meet -supports -two-million -new-
userseach -day. 
158  Response to RFI 9, paragraph 28.  
 
 
41 (208)  Third, the  Notifying Party estimates that the number of users of Nuance’s Dragon 
P&C  is just too small to enable the merged entity to foreclose rival productivity 
software suppliers.159 On the one hand, Nuance estimates that approximately [...] 
users worldwide have pu rchased a Dragon P&C version in the last two years, which 
is only a fraction of the total number of users of productivity software. Microsoft 
estimates that there are approx imately  [...] users of productivity software worldwide, 
and thus Dragon P&C users r epresent less than [0-5]% the number of users of 
productivity software. At the same time, Nuance notes that the Dragon P&C line of 
business generated approximately [...] in revenue in 2020, and approximately [...] in 
2019. Based on an average  selling price  of [...], approximately [...] users worldwide 
have purchased a Dragon P&C version (including Law Enforcement and Legal)160 in 
the last two years, less th an [0-5]% the number of Microsoft Office 365 seats ( [...]). 
Even assuming that users who purchased Drago n outside healthcare in 2018, 2017, 
and 2016 would still be using it today the overall user base accounts for 
approximately [0-5]% the number of Microsoft Office 365 seats.161 
(A.ii) Incentive to engage in foreclosure  
(209)  The Notifying Party states that the merged enti ty would have no incentive to 
foreclose competing providers of productivity software given that the transcription 
software integrations actually increase the value of Microsoft’s platform technology. 
Microsoft would not degrade those integrations.162  
(210)  Furthe rmore, the Notifying Party  submits that it is susceptible to retaliation.163 
Microsoft relies on integrations with the makers of rival productivity suites in other 
areas. For example, Microsoft’s Duo smartphone uses Google’s Android OS,164 and 
its web browser,  Edge, relies on the Google -led Chromium open -source project.165 
There would also be reputational damage to Microsoft in denying relevant 
integrations to its customers.  
(B) The Commission’s assessment  
(211)  For the reasons set out below, the Commission considers that the Transaction does 
not lead to credible foreclosure concerns in the market for productivity software, 
regardless of the precise product and geographic market definitions retained (see 
Sections 4.5.1.3  and 4.5.2.3  above).  
(B.i) Ability to engage in foreclosure  
(212)  The Commission considers that post -Transaction, while it would be technically 
possible for the merged entity to change Dragon P&C integration with third party 
productiv ity software, Microsoft would not have the ability to foreclose its 
                                                 
159  Form CO, paragraphs 467 -468. 
160  See Form CO, Table 7.  
161  For reference, Nuance notes that its Dragon P&C line of business generated USD [...] in 2018, USD [...] in 
2017, and USD [...] in 2016. The total revenue over the period 2016 -2020 amounts to USD [...]. Based on 
an average selling price of USD [...], this implies an estimated [...].  
162  Form CO, paragraph 469.  
163  Response to RFI 9, paragraph 32.  
164  See https://www microsoft.com/en -us/surface/devices/surface -duo? activetab=overview . 
165  See https://www.theverge.com/2018/12/6/18128648/microsoft -edge -chrome -chromium -browserchanges . 
 
 
42 productivity software rivals through either preventing access to Nuance’s 
transcription software outside of healthcare or otherwise degrading the conditions on 
which it supplies these prod ucts, for the following reasons.  
(213)  First, Nuance has a very limited  market share for the provision of non -healthcare 
transcription software. Nuance’s market share in transcription software outside 
healthcare was [0-5]% in the EEA and [0-5]% globally in 2020.166  
(214)  Second, as set out above in paragraph  (208) , Nuance estimates that approximately 
[...] users worldwide have purchased a Dragon P&C offering in the last two years,167 
which is less than [0-5]% the number of Micro soft/Office 365 users168 and less than 
[0-5]% the number of users of productivity software worldwide .169 Even in a 
hypothetical scenario in which all of Dragon P&C users were to stop using 
Microsoft’s rival productivity software, it would be implausible that t he loss of 
fewer than [...] users (of which a certain percentage will have used Office 365 
already) worldwide would impact Microsoft’s rivals’ businesses in any meaningful 
way. In any event, [indication of market positioning and performance of the 
product] .170 
(215)  Third , a wide range of providers populates the market for transcription services. 
Available solutions range from AI -based online solutions (e.g.,  Temi) to manual 
transcription services performed by humans (e.g.,  GMR transcription, Go 
Transcript). Nuance ’s main competitors include Amazon, Otter AI, Recognosco, 
VIQ Solutions, Philips ( SPS), Scribie, Temi, TranscribeMe and WoltersKluwer.171   
(216)  Fourth , a third -party market research report, i.e. , the G rand View Research  report172, 
refers to the followi ng global co mpanies as having “h igh” market relevance in the 
(overall) market for transcription services (along with Nuance itself): 3Play Media, 
Acusis, LLC, AQuity Solutions, Captionmax LLC, CareCLoud, Crystal Hues, 
GoTranscript, 3M/M*Modal, Rev.com, Robin Healthcar e, TranscribeMe, TSG 
Reporting, and Vitac.  
(217)  Fifth, the Commission’s analysis of the Parties’ internal documents has not yielded 
any results suggesting that Microsoft or Nuance consider the Nuance P&C suite (or 
any transcription software) as an important in put for productivity software giving 
them a significant degree of market power in the transcription software market. This 
appears confirmed by third party analysis reports.173 For instance, Gartner describes 
three key areas customers should consider when com paring Google Workspace to 
Microsoft 365: cost, security, and applications. According to Gartner, 
interoperability with third -party transcription software is not considered a relevant 
                                                 
166  Form CO, paragraph 462 and T ables 11 and 11A.  
167  This also includes Legal and Law Enforcement.  
168  Form CO, paragraph 468.  
169  Form CO, paragraph 467.  
170  Response to RFI 9, paragraph 30.  
171  Form CO, paragraph 449.  
172  Form CO, Annexes 8 and 9. See section 7 of the GVR report for more de tails on these companies.  
173  Response to RFI 9, Annex 2, the Gartner report “ How to Decide Between Google Workspace and 
Microsoft 365 ”. 
 
 
43 factor and therefore does not drive customers’ purchasing decisions in r elation to 
productivity suites .174   
(218)  Finally, the Commission notes that Microsoft publicly commits to building open, 
accessible and interoperable products. For instance, one of Microsoft’s internal 
documents state: [BUSINESS SECRET.175 There are some indicatio ns that 
Microsoft Office 365 today supports thousands of integrations with other 
applications  and services, many include Microsoft’s competitors.176 
(219)  For the reasons set out above, the Commission considers that the merged entity 
would not have the ability to engage in a successful foreclosure strategy concerning  
Nuance’s transcription software outside of healthcare products.  
(B.ii) Incentive to engage in foreclosure  
(220)  The Commission notes that the conditions for a successful foreclosure strategy to 
occur are cumulativ e. Since the Commission concluded that the Notifying Party 
would not have the ability to engage in a successful foreclosure strategy, the 
Commission considers that the Parties’ incentive to foreclose competing productivity 
software suppliers from accessing  Nuance’s transcription software outside of 
healthcare is not decisive. Therefore, the Commission does not have to take a 
position on the Parties’ incentive to engage in input foreclosure.  
(B.iii)  Impact on effective competition  
(221)  Given Nuance’s very limited market  share in the transcription market (outside of 
healthcare) and the fact that Dragon P&C represents less than [0-5]% the number of 
users of productivity software  (see paragraph s (213)  and (214)  above), the 
Commission considers that there would not be a detrimental  impact on effective 
competition  in the productivity software market . 
(222)  This conclusion is consistent with the results of the market investigation with the 
majorit y of respondents considering that the Transaction would not have a negative 
effect on their business177, including concerning  respondents’  ability to procure non -
healthcare transcription services .178  
(B.iv)  Conclusion  
(223)  For the reasons set out above, the Commission co nsiders that the Transaction will 
not raise serious doubts as to the compatibility with the internal market with respect 
to possible foreclosure practices of competing productivity software providers from 
                                                 
174  Response to RFI 9, Annex 2, the Gartner report “ How to Decide Between Google Workspace and 
Microsoft 365 ”. 
175  Form CO , Annex 5.2.116.  
176  See https://www microsoft.com/en -us/store/apps/windows . 
177  Q1 – Questionnaire to competitors for transcription software, replies to questions 41 and 41.1; Q2 – 
Questionn aire to customers for transcription software, replies to questions 30 and 30.1; Q3 – 
Questionnaire to competitors for cloud services, replies to question 20; and Q4 – Questionnaire to 
competitors for communication platforms, replies to questions 27 and 28.  
178  Q2 – Questionnaire to customers for transcription software, replies to questions 32 and 32.1.   
 
 
44 accessing Nuance’s transcription software outside o f healthcare  regardless of the 
exact product market definition retained.   
5.3.2.2.  Possible foreclosure of competing transcription providers  outside of healthcare  by 
restricting or degrading  access to Microsoft’s productivity suite  
(A) The Notifying Party’s view  
(224)  The N otifying Party  argues that it would  have  neither  the ability nor the incentive to 
foreclose  competing transcription software providers by restricting access to 
Microsoft’s productivity services  (e.g., the Office 365 applications  such as Word, 
Outlook, Pow erPoint or Excel) .179 
(A.i) Ability to engage in input foreclosure  
(225)  First, the Notifying Party submits that Nuance’s main competitors such as Otter AI, 
Recognosco, and VIQ Solutions do not integrate with Microsoft’ s Office 365 
applications today . By contrast, Otter  AI integrates with Google Meet, Zoom and 
Dropbox.180 Since Nuance’s main competitors do not currently integrate with 
Microsoft productivity applications, the Transaction cannot result in any meaningful 
structural change.  
(226)  Second, according to the Notifying Party, customised integration is not necessary to 
compete because transcription can be done effectively outside of the relevant 
productivity software application and then copied into the productivity application 
(e.g., Microsoft Word ). For example, in Otte r AI, the relevant transcribed text is 
available in an online interface for users to view, edit, share, copy into another 
application, or export in a number of standard formats (i.e ., clipboard, txt, docx, pdf, 
srt).181 Therefore, regardless of the presence of a customised integration, transcribed 
text can be copied to  the applications that users choose to use.182 
(A.ii) Incentive to engage in input foreclosure  
(227)  The Notifying Party  submits that it would not have the incentive to foreclos e rival 
transcription and access ibility software providers outside healthcare. Microsoft 
already offers productivity software and transcription functionality, and does not 
seek to prevent third parties from integrating with Office. This would be unchanged 
by the Transaction. These integr ations increase the value of Microsoft’s productivity 
software and Microsoft would not degrade those integrations.183  
(B) The Commission’s assessment  
(228)  For the reasons set out below, the Commission considers that the Transaction does 
not lead to credible foreclos ure concerns in the market for transcription software 
outside of healthcare, regardless of the precise product and geographic market 
definitions retained (see Sections 4.1.1.3  and 4.1.2.3  above).  
                                                 
179  Form CO, paragraph 471.  
180  Form CO, paragraph 471 and see https://help .otter.ai/hc/en -us/categories/360003539134 -Integrations .  
181  See https://help.otter.ai/hc/en -us/articles/360047731754 .  
182  Form CO, paragraph 472.  
183  Form CO, paragraph 473.  
 
 
45 (B.i) Ability to engage in foreclosure  
(229)  The Commission considers that post -Transaction, while it would be technically 
possible for Microsoft to restrict access to Microsoft’s productivity software, the 
merged entity would not have the ability to foreclose Nuance’s transcription 
software rivals through either preventing access to Microsoft’s Office package or 
otherwise degrading the conditions on which it supplies these products, for the 
following reasons.  
(230)  None of Nuance’s main competito rs integrate with Microsoft Office 365 today, so 
the Transaction would not create any structural change in the market. Furthermore, 
this conclusion appears consistent with the results of the market investigation given 
that none of the competing transcripti on software providers that responded to the 
market investigation indicated that their transcription software (or speech -
recognition APIs) directly interacted with Microsoft’s productivity software 
solutions.184 In any event, as set out by the Notifying Party  in paragraph (226)  above, 
customised integration is not necessary to compete because transcription can be done 
effectively outside of the relevant productivity software application and then copied 
into the produ ctivity application.  
(231)  For the reasons set out above, the Commission considers that the Notifying Party 
would not have the ability to engage in a successful foreclosure strategy concerning 
Microsoft’s productivity software.  
(B.ii) Incentive to engage in foreclosur e 
(232)  The Commission considers that post -Transaction the merged entity  would not have 
the incentive to foreclose Nuance’s transcription software rivals through either 
preventing access to Microsoft’s productivity software or otherwise degrading the 
conditions on which it supplies this productivity software, for the following reasons.  
(233)  The majority of respondents that took a view on this question  believe that the 
Notifying Party  would not have the incentive to restrict access to transcription 
software providers f rom integrating with Microsoft’s productivity software 
solutions, or to otherwise deteriorate the conditions for access.185 One respondent 
specifically noted that they have no evidence that Microsoft would have such an 
incentive. On the contrary, according t o this respondent, Microsoft currently appears 
open to integrating third party providers into their platform.186 
(234)  Furthermore, and for completeness, one of the use cases for Nuance’s P&C offerings 
is accessibility. The integration of Dragon P&C with Microsoft ’s productivity 
applications (ranging from Microsoft Word, Excel, Outlook to PowerPoint) enables 
users to control those applications with, and dictate text using, their voice. The 
Commission notes that Microsoft has made a strong public commitment to creat ing 
accessible  products : “We believe that accessible technology is a fundamental 
building block that can unlock opportunities in every part of society. Our work starts 
by ensuring that Microsoft’s own products are accessible by design, so that as we 
advanc e our features and functionality, we can help everyone across the spectrum of 
                                                 
184  Q1 – Ques tionnaire to competitors for transcription software, replies to questions 37 and 37.1.  
185  Q2 – Questionnaire to customers for transcription software, replies to questions 27 and 27.1.  
186  Q2 – Questionnaire to customers for transcription software, replies to questions 27 and 27.1.  
 
 
46 disability be more productive. We will then expand our reach with new tools and 
data resources to support software development across our industry and by other 
organizations that  create software services for their customers or employees…”.187 
Making Dragon P&C users’ experience worse by deprecating integrations with third -
party productivity software would conflict with Microsoft’s own vision and 
commitment. There are some indication s that t oday , Microsoft both builds 
accessibility functionality into Windows, and maintains an open Windows 
Accessibility API program to ensure third -party accessibility vendors can build 
Windows applications.188 More generally, Microsoft has publicly commit ted to build 
open, accessible and interoperable products.189 Accordingly, it would be 
counterproductive to foreclose rival providers of transcription software in view of 
Microsoft’s objective of building credibility and trust with its customers.   
(B.iii)  Impact on effective competition  
(235)  Given the fact that the Transaction would not create any change in the market (see 
paragraph (230)  above), the Commission considers that there would not be a 
detrimental  impact on effective competition  in the transcription software market 
including  outside of healthcare . 
(236)  This conclusion is consistent with the results of the market investigation with the 
majority of respondents considering that the Transaction would not have a negative 
effect on their busines s190, including the respondents’ ability to compete as a supplier 
of non -healthcare transcription services.191  
(B.iv)  Conclusion  
(237)  For the reasons set out above, the Commission concludes that the Transaction does 
not raise serious doubts as to the compatibility with t he internal market with respect 
to possible foreclosure practices of transcription providers outside of healthcare from 
accessing Microsoft’s productivity software products regardless of the exact product  
market definition retained.  
                                                 
187  See statement by Brad Smith, President and Vice Chair available at: 
https://blogs.microsoft.com/blog/2021/04/28/doubling -down -on-accessibility -microsofts -next-steps -to-
expand -accessibility -in-technology -the-workforce -and-
workplace/#:~:text=This%20new%20initiative%20will%20bring,enter%20the%20workforce%3B%20and
%20building .  
188  Form CO, paragraph 478.  
189  Form CO, paragraph 443.  
190  Q1 – Questionnaire to competitors for transcription software, replies to questio ns 41 and 41.1; Q2 – 
Questionnaire to customers for transcription software, replies to questions 30 and 30.1; Q3 – 
Questionnaire to competitors for cloud services, replies to question 20; and Q4 – Questionnaire to 
competitors for communication platforms, r eplies to questions 27 and 28.  
191  Q1 – Questionnaire to competitors for transcription software, replies to questions 43 and 43.1; Q3 –
Questionnaire to competitors for cloud services, replies to question 22; and Q4 – Questionnaire to 
competitors for communi cation platforms, replies to question 26.  
 
 
47 5.3.3.  Nuance’s transcription  software outside of healthcare and Microsoft’ s PC OS  
(238)  These activities give rise to an affected market given that the Parties are active in 
neighbouring markets and Microsoft’s market share exceeds 30%:  
(a) Nuance’s transcription software outside of healthcare  (EEA: [0-5]%; Global: 
[0-5]%);192 and 
(b) Microsoft’s  PC OS (EEA: [70-80]%193; Global: [70-80]%194)195.   
(239)  Nuance’s Dragon solutions are designed to run on Windows, i.e ., Microsoft’s PC 
OS. This creates a conglomerate relationship between Nuance’s transcription 
softwa re outside of healthcare and Microsoft’s PC OS.196  
5.3.3.1.  Possible foreclosure of competing PC OS providers by restricting or degrading 
access to Nuance’s transcription software outside of healthcare  
(A) The Notifying Party’s view  
(240)  The Notifying Party  argues that it wo uld not have the ability to exclude competing 
PC OS providers by restricting access to Nuance’s transcription software by 
degrading or withdrawing interoperability with Dragon .197 
(241)  First, Nuance’s Dragon is available exclusively on Windows PC OS. As such, any  
foreclosure concern is not merger -specific.198 
(242)  Second, transcription functionalities are not a key consideration for the vast majority 
of users when choosing a PC OS. This is all th e more so since competing PC OS  
already offer their own transcription functi onalities.199  
(243)  Third, users that need advanced transcription services represent a tiny fraction of the 
total user base of an OS, which is yet another reason why the merged entity would 
have n o ability to foreclose rival OS .200 
(B) The Commission’s assessment  
(244)  For t he reasons set out below, the Commission considers that the Transaction does 
not lead to credible foreclosure concerns in the market for the supply of PC OS, 
regardless of the precise product and geographic market definitions retained (see 
Sections 4.6.1.3  and 4.6.2.3  above).  
                                                 
192  Form CO, paragraph 462. The Parties submit that these are conservative estimates as they represent only 
transcription “software” to the exclusion of transcription “services” which would also include SaaS, onlin e 
transcription tools and manual transcription and bring its share down to [0-5]%.  
193 Form CO, paragraphs 481.  
194 Form CO, paragraphs 481.  
195  The Commission has not reached out to the market in order to verify the methodology and computations 
underlying the  market shares provided by Microsoft.  
196  Form CO, paragraph 481.  
197  Form CO, paragraph 483.  
198  Form CO, paragraph 484.  
199  Form CO, paragraph 485.  
200  Form CO, paragraph 486                
 
 
48 (B.i) Ability to engage in foreclosure  
(245)  The Commission considers that post -Transaction the merged entity  would not have 
the ability to foreclose its PC OS ’ rivals through either preventing access to 
Nuance’s transcription software outside of healthcare or otherwise degrading the 
conditions on which it supplies these products, for the following reasons.  
(246)  First, as the Notifying Party has indicated (see paragr aph (241)  above), Nuance’s 
transcription software is currently only available on Microsoft’s PC OS. Therefore, 
any foreclosure concern in this regard cannot be merger -specific.  
(247)  Second, as set out in paragraphs (238)  and (213)  above, Nuance has a very limited 
market share for the provision of non -healthcare transcription software. Nuance’s 
market share in transcription software  outside healthcare was [0-5]% in the EEA and 
[0-5]% globally in 2020.201  When considering an overall market for transcription 
software, Nuance’s market share was [0-5]% in the EEA and [0-5]% globally in 
2020.202 
(248)  Third, the Notifying Party  reports that there are currently more than 1.3 billion 
devices running Windows 10203 and Statista reports that in 2019 there were 
approximately 1.5 billion internet users using Windows OS worldwide.204 The 
estimated [...] users who purchased Dragon P&C in the last two years therefore 
represent only a tiny fraction of the overall user base of Windows.  In any event, 
[description of market positioning and performance of the product] .205 
(249)  Fourth, as already set out above in paragraphs (215)  and (216) , a wide range of 
providers populates the market for transcription services. Available solutions range 
from AI -based online solutions (e.g ., Temi) to manual transcription services 
performed by humans (e.g. , GMR transcription, Go Transcript).206   
(250)  Therefore, for the reasons set out above, the Commission considers that the 
Notifying Party would not have the ability to engage in a successful foreclosure 
strategy concerning Nuance’s transcription software outside  of healthcare products.  
(B.ii) Incentive to engage in foreclosure  
(251)  The Commission notes that the conditions for a successful foreclosure strategy to 
occur are cumulative. Since the Commission concluded that the Notifying Party 
would not have the ability to engag e in a successful foreclosure strategy, the 
Commission considers that the Parties’ incentive to foreclose competing PC OS 
providers from accessing Nuance’s transcription software outside of healthcare is not 
decisive. Therefore, the Commission does not hav e to take a position on the Parties’ 
incentive to engage in input foreclosure.  
                                                 
201  Form CO, paragraph 462 and Tables 11 and 11A.  
202  Form CO, Tables 1 1 and 11A.  
203  See https://news.microsoft.com/bythenumbers/en/windowsdevices .  
204  See https://www.statista.com/statistics/543185/worldwide -internet -connected -operating -
systempopulation/ .  
205  Response to RFI 9, paragraph 45.  
206  Form CO, paragraph 449.  
 
 
49 (B.iii)  Impact on effective competition  
(252)  Given Nuance’s very limited market share in the transcription market (outside of 
healthcare) (see paragraph (213)  above) and the fact that Nuance’s Dragon product is 
currently only available on Microsoft’s PC OS already, the Commission considers 
that there would not be a detrimental impact on effective competition in the PC OS’ 
market.  
(253)  This conclusion is  consistent with the results of the market investigation with the 
majority of respondents considering that the Transaction would not have a negative 
effect on their business207, including concerning respondents’ ability to procure non -
healthcare transcriptio n services.208  
(B.iv)  Conclusion  
(254)  For the reasons set out above, the Commission considers that the Transaction will 
not raise serious doubts as to the compatibility with the internal market with respect 
to possible foreclosure practices of competing PC OS providers  from accessing 
Nuance’s transcription software outside of healthcare regardless of the exact product 
market definition retained.  
5.3.3.2.  Possible foreclosure of rival transcription software providers outside of healthcare 
by restricting or degrad ing access to Mi crosoft’s PC OS   
(A) The Notifying Party’s view  
(255)  First, the Notifying Party  argues that there is no real conglomerate relationship 
between the transcription software outside healthcare and the PC OS. The only link 
is that, like any application, the transcriptio n application must be installed on the OS. 
Therefore, the only potential action Microsoft could theoretically take in this space 
would be to deny rival transcription software providers the ability to build a 
Windows application.209  
(256)  Second, focusing on the t ranscription software with accessibility functions (which 
must be able to interoperate with the OS to command and control the OS), the 
Notifying Party  submits that  would not have an incentive to foreclose Nuance’s rival 
transcription software providers out side healthcare by preventing these from 
integrating their transcription solutions with accessibility functions with the 
Windows OS such that they would no longer be used to command the Windows 
OS.210 
(257)  The Notifying Party submits that the consequence on Micro soft’s reputation of 
denying access to an accessibility solution that seeks to help people with disabilities 
would be disastrous and at odds with Microsoft’s accessibility strategy. Microsoft 
recently announced an ambitious five -year plan in which it pledg es to “ create and 
                                                 
207  Q1 – Questionnaire to competitors for transcription software, replie s to questions 41 and 41.1; Q2 – 
Questionnaire to customers for transcription software, replies to questions 30 and 30.1; Q3 – 
Questionnaire to competitors for cloud services, replies to question 20; and Q4 – Questionnaire to 
competitors for communication platforms, replies to questions 27 and 28.  
208  Q2 – Questionnaire to customers for transcription software, replies to questions 32 and 32.1.   
209  Response to RFI 8, paragraph 48.  
210  Form CO, paragraph 487.  
 
 
50 open doors to bigger opportunities for people with disabilities ” not merely 
technologically, but also in the workforce and in the workplace.211 This is also in line 
with Microsoft’s ongoing efforts in supporting the development of accessibi lity 
solutions via Windows Accessibility, a service that helps Windows developers 
design accessible applications, assistive technology developers build tools such as 
screen readers and magnifiers, and software test engineers create automated scripts 
for te sting Windows applications. As part of Windows Accessibility, Microsoft also 
offers its Windows Automation open API service for user interface accessibility.212 
Microsoft has never deprived, [...], Windows users of third -party accessibility 
solutions.213 
(B) The C ommission’s assessment  
(258)  For the reasons set out below, the Commission considers that the Transaction does 
not lead to credible foreclosure concerns in the market for transcription software 
outside of healthcare, regardless of the precise product and geograp hic market 
definitions retained (see Sections 4.1.1.3  and 4.1.2.3  above).  
(B.i) Ability to engage in foreclosure  
(259)  The Commission considers that post -Transaction the merged en tity would not have 
the ability to foreclose Nuance’s rival transcription software outside of healthcare 
suppliers by either preventing access to or otherwise degrading the conditions on 
which it supplies its PC OS.  
(260)  The Commission notes that Microsoft main tains an open Windows API program to 
ensure third -party vendors can build Windows applications: “ Using the Windows 
API, you can develop applications that run successfully on all versions of Windows 
while taking advantage of the features and capabilities un ique to each version ”.214 
Since this is an open API, Nuance’s rivals can use it to build their software to run on 
Windows.  
(B.ii) Incentive to engage in foreclosure  
(261)  The Commission considers that post -Transaction the merged entity would not have 
the incentive to fo reclose its transcription software outside of healthcare rivals by 
either preventing access to or otherwise degrading the conditions on which it 
supplies its PC OS, for the following reasons.  
(262)  First, the Notifying Party  specifically designed Windows to be a n open OS. 
Microsoft has never prevented rivals from developing a  Windows application. In 
addition, Microsoft already offers certain transcription functionalities as part of 
Microsoft 365 and it has not sought to engage in any foreclosure strategy. There i s 
no reason why the acquisition of Dragon P&C, [...], would change Microsoft’s 
incentives.  
                                                 
211  See https://blogs microsoft.com/blog/2021/04/28/doubling -down -on-accessibility -microsofts -next-steps -
to-expand -accessibility -in-technology -the-workforce -and-workplace/ .  
212  See https://docs microsoft.com/en -us/windows/win32/winauto/windows -automation -api-portal .  
213  [...].  
214  See https://docs microsoft.com/en -us/windows/win32/apiindex/windows -api-list. 
 
 
51 (263)  Second , the majority of respondents do  not know or do not believe that Microsoft 
would have the incentive to restrict access to transcription software providers from  
integrating with Microsoft’s PC OS, or to otherwise deteriorate the conditions for 
access.215 One respondent specifically noted that they have no evidence that 
Microsoft would have an incentive  to restrict access to the Windows platform for 
other software p roviders .216  
(B.iii)  Impact on effective competition  
(264)  The Commission considers that there would not be a detrimental impact on effective 
competition in the transcription software market including outside of healthcare.  
This conclusion is consistent with the results of the market investigation with the 
majority of respondents considering that the Transaction would not have a negative 
effect on their business217, including the respondents’ ability to compete as a supplier 
of non -healthcare transcription services.218  
(B.iv)  Concl usion  
(265)  For the reasons set out above, the Commission considers that the Transaction will 
not raise serious doubts as to the compatibility with the internal market with respect 
to possible foreclosure practices of competing transcription software providers 
outside of healthcare by restricting access to the Windows PC OS environment 
regardless of the exact product market definition retained.  
5.3.4.  Bundling of Nuance’s healthcare transcription software and Microsoft’s cloud 
services  
(266)  One respondent to the market inv estigation , who is a distributor of Nuance’s 
products , raised concerns about a potential bundling of Nuance’s transcription 
software with Microsoft’s cloud services. The respondent suggested that post -
Transaction, Nuance’s services would no longer be made available as an on -premise 
solution and would only be offered together with the purchase of Microsoft Azure 
cloud services. That would make Nuance products more expensive for customers 
that currently use an on -premise solution.219 
(267)  The Commission does not con sider this to present a significant risk to competition. 
As stated in the Non -Horizontal Merger Guidelines220, “[t]ying and bundling as such 
are common practices that often have no anticompetitive consequence ”. Only in 
                                                 
215  Q1 – Questionnaire to competitors for transcription software, replies to questions 40 a nd 40.1; Q2 – 
Questionnaire to customers for transcription software, replies to questions 29 and 29.1.   
216  Q2 – Questionnaire to customers for transcription software, replies to questions 29 and 29.1.  
217  Q1 – Questionnaire to competitors for transcriptio n software, replies to questions 41 and 41.1; Q2 – 
Questionnaire to customers for transcription software, replies to questions 30 and 30.1; Q3 – 
Questionnaire to competitors for cloud services, replies to question 20; and Q4 – Questionnaire to 
competitors for communication platforms, replies to questions 27 and 28.  
218  Q1 – Questionnaire to competitors for transcription software, replies to questions 43 and 43.1; Q3 –
Questionnaire to competitors for cloud services, replies to question 22; and Q4 – Questionna ire to 
competitors for communication platforms, replies to question 26.  
219  Q2 – Questionnaire to customers for transcription services, replies to questions 27, 29, 30 and minutes of 
call dated 3 December 2021, Doc ID 582. 
220  Guidelines on the assessment o f non -horizontal mergers under the Council Regulation on the control of 
concentrations between undertakings, OJ C 265, 18 October 2008, p. 6.  
 
 
52 certain circumstances, these practices are considered to have a negative impact on 
competition and that is when they “ may lead to a reduction in actual or potential 
rivals’ ability or incentive to compete ”.  
(268)  As the markets for transcription software in healthcare and cloud services are 
vertical ly affected, the Commission has already assessed whether the Transaction 
would allow the merged entity  to foreclose its competitors either on the upstream or 
downstream market (see Sections 5.2.1  and 5.2.2 ). For the reasons set out in these 
Sections, the Commission concluded that the Notifying Party  does not have the 
ability to foreclose its competitors on these markets and that a potential foreclosure 
strategy would onl y have a limited impact.  
(269)  For the same reasons as set out in these Sections, increasing the extent to which 
Nuance’s transcription software is bundled with Microsoft’s cloud services would 
not lead to a reduction in actual or potential rivals’ ability or in centive to compete. 
Therefore, any potential price increase by bundling additional products would not be 
merger specific.  
5.3.5.  Restricting access to data transcribed by Nuance's transcription software in 
healthcare  
(270)  The same respondent to the market investigati on also raised concerns about a 
potential restriction of access to data transcribed by Nuance’s transcription software 
in healthcare. This respondent noted that STT software is important in the medical 
industry and that Nuance is the market leader in this market. The next industry 
development will be the interaction of STT software with software that structures 
and analyses transcribed text to become able to give doctors feedback and input on 
decisions such as diagnosis and a proposed course of treatment. T he respondent 
suggested that post -Transaction, the merged entity could restrict access to 
transcription data created by Nuance’s products and prevent the use of this data by 
software from other players in the healthcare segment.221 
(271)  This concern is, however, not credible . Nuance already has a high share in the 
market for the transcription services for healthcare which is unaffected by the 
Transaction. Moreover, to the extent that software with NLU capabilities helps 
doctors’ decision -making, this is already be ing developed by the Parties together 
through the DAX partnership (see Section 5.3.1  below). Furthermore, all data 
relevant for other software will be stored in the EHR system. The Parties have no 
control over ac cess to data stored in the EHR system as these systems are offered by 
independent third parties. For an assessment specifically relating to a foreclosure of 
competing CRM software providers, see Section 5.3.6 . 
(272)  These findings are supported by the internal documents of Microsoft, for example in 
an email evaluating the Transaction underlining that Nuance needs to remain neutral 
with regard to other players in the healthcare sector such as providers of electronics 
healthcare record providers: [...].222 
                                                 
221  Q2 – Questionnaire to customers for transcription services, replies to questions 27, 29, 30 and minutes of 
call dated 3 December 2021, Doc ID 582. 
222  Form CO, Annex 5.0.31.  
 
 
53 (273)  For the reasons set out above, the Commission concludes that the Transaction does 
not raise serious doubts as to the compatibility with the internal market with respect 
to restricting access to data transcribed by Nuance's  transcription software in 
healthcare.  
5.3.6.  Possible foreclosure of rival CRM suppliers by denying or restricting access to 
Nuance’s transcription software in healthcare  
(274)  Another complainant raised concerns that the merged entity  would have the ability 
and ince ntive to use Nuance’s voice recognition software, more specifically DMO, 
to foreclose rival providers of healthcare software in general and rival healthcare 
CRM suppliers in particular by denying or restricting access to Nuance’s speech data 
generated by D MO (e.g ., via bundling, technological tying and degradation of 
interoperability). Microsoft’s alleged goal would be to create a closed, Microsoft -
only ecosystem, as opposed to a system whereby European healthcare providers 
have a free choice where they obt ain their productivity, EHR, CRM, business 
intelligence and other (healthcare) software, choosing the ‘best of breed’ supplier in 
each category.223 The complaint further argues that Microsoft could create unique 
data-driven and AI -driven patient insights and  feed them directly into its own cloud 
or CRM products instead of or in addition to the EHR software. This would give its 
own products a competitive advantage since the data captured by Nuance would be 
broader and richer than the data  made available to th e EHR software.  
(275)  The Notifying Party submits that this complaint is without merit.224 First, DMO and 
the data it generates is used by only a fraction of healthcare providers, while the 
healthcare space itself only represents 15 -20% of the global CRM market. T herefore , 
DMO cannot be used to foreclose rival CRM suppliers. Second, the Parties do not 
own or control any EHR and therefore cannot prevent rival CRM suppliers from 
accessing the data in EHRs. Third, [...]. It also represents only a small fraction of the  
patient’s medical data, with the vast majority not captured by DMO and residing in 
the EHR. Fourth, the Commission found in Microsoft/LinkedIn that switching CRM 
provider is uncommon due to the efforts required. Finally, none of the documents the 
Parties provided to the Commission suggest that Microsoft might be able to use 
Nuance’s speech data to foreclose the CRM market.  
(276)  With regard to the possible foreclosure of rival CRM suppliers, the Commission 
does not consider this concern credible  for the followi ng reasons.  
5.3.6.1.  Ability to engage in foreclosure  
(277)  The Commission considers that post -Transaction, the merged entity  would not have 
the ability to foreclose its CRM supplier rivals225 by denying or restricting access to 
Nuance’s transcription software in healthcar e, for the following reasons.  
(278)  First, there is no direct link between transcription and CRM software. The 
information dictated  by doctors using DMO is stored in an EHR system, which is 
accessible to any software that integrates into the IT system of the res pective 
                                                 
223  Submission of a software provider targeting European healthcare providers of 6 December 2021.  
224  Response to CRM complaint of 9 December 2021, paragraph 2.  
225  This relates to the overall CRM  software market, but the Commission’s assessment also applies to the 
potential narrower markets as set out in Section 4.7 above.  
 
 
54 healthcare provider, including rival CRM systems. This EHR system stores a 
patient’s entire medical record, including but not limited to the medical notes that a 
physician dictates using DMO. The Parties do not own or control any EHR, and 
therefore  cannot prevent third -party software, including rival CRM providers, from 
accessing the data in these third -party EHR systems.226 Under these circumstances, 
the merged entity does not have the ability to foreclose other software providers in 
general or CRM s oftware providers specifically from accessing data that has been 
transcribed using Nuance software.  
(279)  Second, as regards the claim that the data available to Nuance is extremely broad and 
rich patient data that can inform and train complex AI algorithms and  make 
recommendations to clinicians, the Commission considers that for the purposes of 
other software integrating into the healthcare provider’s IT system, the data in the 
EHR is broader and richer. While it could be stated that the healthcare  transcriptio n 
software has access to more data than the one that is contained in its output (e.g. 
potential amendments or revisions, pauses, background sounds, differences in voice 
modulation, see also Section 5.2.3 ), it is the core feature of transcription software to 
reduce all this data into to the most relevant information, i.e., the transcribed text. 
This output is then passed -on to the EHR and available for other software programs. 
The EHR, to the contrary, has much bro ader and richer data of relevant information. 
It contains the most relevant information not only from transcription software, but 
from all relevant software components used by the respective healthcare provider 
(e.g., electronically transmitted laboratory results or data from health insurance 
companies) as well as all information that has been manually entered into the EHR 
without using transcription software. In this regard, it has to be noted that the EHR is 
designed to be the central place for all data t hat is considered relevant and important 
by the respective healthcare provider. Additional information that might be available 
to individual software components that is not transferred into the EHR is most likely 
of no or very limited relevance for the hea lthcare provider. In addition, as submitted 
by the Notifying Party, [...].227 Therefore, it seems unlikely that access to such 
additional data could give the Notifying Party competitive advantage.  
(280)  Third, Microsoft is a very small player in the CRM market wit h a 2019 share of [0-
5]% worldwide and [0-5]% in the EEA.228 In a potential EEA -wide healthcare CRM 
market, Microsoft estimates this share would decrease to around [0-5]% and 
similarly, it would be below [0-5]% worldwide.229 As set out in the Commission’s 
Micr osoft/LinkedIn decision230, the market for CRM software solutions is 
fragmented and characterised by a large number of different providers. In this 
fragmented competitive landscape, there are a number of competitors including 
major players, all of which have  higher EEA and worldwide CRM market shares231 
than Microsoft, such as Salesforce, SAP, Oracle, and Adobe.232 For instance, 
Salesforce is the clear market leader with an EEA market share of [10-20]% and a 
                                                 
226  Response to CRM complaint of 9 December 2021, paragraph 2.  
227  See Section 5.2.3. 
228  Response to CRM complaint of 9 December 2021, paragraph 2.  
229  Response to CRM complaint of 9 December 2021, paragraph 34.  
230  Commission decision of 6 December 2014 in case M.8124 – Microsoft/Linkedin , para.193.  
231  Form CO, Table 22.  
232  Form CO, paragraph 556.  
 
 
55 worldwide market share of [20-30]%.233 In Microsoft/ Link edIn234 the Commission 
also found that CRM customers have a tendency not to change easily the provider of 
their CRM software solutions. Limiting the integration of Nuance with EHR 
software may risk that hospitals look for a different provider of transcriptio n services 
rather than switching to Microsoft’s CRM.  
(281)  Finally, the Commission notes that in case the use of transcription software in the 
EEA in general and the use of Nuance’s transcription software in particular were to 
increase over the coming years, wit h the effect that the overall percentage of 
physicians using Nuance’s software products would become more significant, 
competing CRM software providers would have the ability to undertake effective 
and timely counterstrategies. Even though Nuance is curren tly the market leader in 
transcription software, there are other transcription software providers that compete 
with Nuance’s products. In the EEA, there are two competitors with market shares 
between [10-20]%. In addition, 3M/M*Modal has only a limited mar ket share for 
transcription software in healthcare in the EEA but has a high market share between 
[30-40]% on a worldwide level (see paragraph (104)  above). If transcription 
software becomes more important for of fering CRM services, competing CRM 
providers could start collaborating  with transcription software providers that are 
competing with Nuance. In particular if Microsoft were to engage in a foreclosure 
strategy, it can be assumed that certain customers, in p articular within the group of 
customers that today follow a “best in breed” approach and deploy software from 
different companies, would resist such attempts and prefer transcription as well as 
CRM software providers that allow full interoperability with t hird-party software.  
5.3.6.2.  Incentive to engage in foreclosure  
(282)  The Commission considers that post -Transaction, the merged entity would not have 
the incentive to foreclose its CRM supplier rivals by denying or restricting access to 
Nuance’s transcription software in healthcare, for the following reasons.  
(283)  First, the Notifying Party’s internal documents indicate that [explanation of 
Microsoft possible strategy in the healthcare sector] .235 This view seems to be shared 
by current partners: one of the leading EHR provide rs in the US considered that the 
Transaction would have a positive impact on their business.236  
(284)  Second, and expanding on the above (see paragraph (283) ), Nuance’s speech data 
that is generated using DMO [...]. DMO  only captures the spoken words dictated by 
a physician and transcribes them into a formatted written note in the EHR. It is the 
EHR system that defines the structure, organizes the data and puts such notes into 
context. CRM systems connect to EHRs to prov ide service agents with relevant 
information for their interaction with patients. Once the CRM software is integrated 
with the EHR, the CRM software can access data in the EHR, including any relevant 
                                                 
233  Form CO, Table 22.  
234  Commission decision of 6 December 2014 in case M.8124 – Microsoft/Linkedin , para.201.   
235  Form CO, Annex 5.2.116.  
236  Q4 – Questionnaire to competitors for communications platforms, replies to question 24.  
 
 
56 data dictated using DMO. However, there is no integratio n between CRM systems 
and Nuance’s healthcare transcription products, including DMO . [...].237 
5.3.6.3.  Impact on effective competition  
(285)  The Commission considers that there would be no or limited impact on effective 
competition.  
(286)  Even though Nuance is the market leader  in healthcare transcription software (as set 
out above in Section 5.1.1 ), the use of such software in the EEA is not yet common. 
While Nuance’s market share in the EEA is [60-70]%, the penetration rate of 
transc ription software is only between [10-20]%.238 Thus, about [10-20]% of all 
physicians in the EEA use Nuance. A potential foreclosure strategy would only 
affect such limited part of the transcription software for healthcare market, 
regardless of the exact geog raphic market definition.  
5.3.6.4.  Conclusion  
(287)  For the reasons set out above, the Commission concludes that the Transaction does 
not raise serious doubts as to the compatibility with the internal market with respect 
to possible foreclosure of rival CRM suppliers by denying or restricting access to 
Nuance’s transcription software in healthcare.  
6. CONCLUSION  
(288)  For the above reasons, the European Commission has decided not to oppose the 
notified operation and to declare it compatible with the internal market and with the 
EEA Agreement. This decision is adopted in application of Article 6(1)(b) of the 
Merger Regulation and Article 57 of the EEA Agreement.   
For the Commission  
 
 
(Signed)  
Margrethe VESTAGER  
Executive Vice-President  
 
 
 
                                                 
237  Response to CRM complaint of 9 December 2021, paragraph 16.  
238  Form CO, Table 9 and paragraphs 370 -371. Note that EU penetration rates are expected to increase in line 
with the general trend towards greater digitisation of the healthcare sector in Europ e, which will in turn 
likely also attract new competitors, as already evidenced by the recent entry of players such as 
Recognosco, Dictate.IT, Epro, 3M/M*Modal and Vocalis.