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Nuance Under Antitrust Investigation
The U.S. Department of Justice has confirmed that it is con-                                          monopoly within the [medical tran-
                                                                                                      scription sector].”
ducting an antitrust investigation of Nuance Communications.                                             According to the email, Preziosi’s
          The investigation is looking at          spreading beyond the scope of the                  comments “focused mainly on the in-
       Nuance’s acquisition of Philips Speech      Philips acquisition or Nuance’s med-               terconnectedness of the dictation/tran-
       Recognition Systems from Royal              ical transcription business.                       scription process to patient care
       Philips Electronics for $96.1 million in       In a December 2008 email obtained               delivery and the healthcare reimburse-
       October 2008.                               by Speech Technology, and sent by                  ment system.”
          There has been concern since the         Peter Preziosi, CEO of the Medical                    He claimed that while the Justice
       purchase that Nuance has essentially        Transcription Industry Association                 Department had general familiarity
       taken control of the world’s medical        (MTIA), to MTIA’s board and others,                from an economic, policy, and tech-
       transcription market. It already domi-      Preziosi said he took part in a meet-              nology perspective, it had little if any
       nated the field in the United States,       ing called by Justice Department                   knowledge of how the transcription
       and with Philips, which had a very          lawyers and economists, who were                   sector operates specifically.
       strong foothold in Europe, it was said      investigating whether “recent acquisi-                Preziosi explains in an interview
       to have seized that market as well.         tion activity of Nuance constituted a                                  continued on next page
          During its history, Nuance has had a
       robust acquisitions strategy, acquiring a
       number of competitors. Since 2006           Nuance Acquires Voicemail-to-Text Provider Jott
       alone, it has swallowed as many as 15       >> Nuance Communications expanded its Mobile Division voice services portfolio
       companies, including Dictaphone, a          with the acquisition of Jott July 14. Financial terms of the deal were not disclosed.
       major medical transcription player for         Jott is the creator of the Jott Assistant, which enables users to create notes, set
       which it paid $357 million; eScription,     reminders and appointments, send email and text messages, and post to their favorite
       another medical transcription firm for      Web services—all via voice.
       which it paid $340 million; and Jott           According to Mike Thompson, senior vice president and general manager of Nuance
       Networks, the Seattle-based provider of     Mobile, Nuance had been very impressed with Jott and its leadership team. “When we
       mobile voice-to-text applications (see      looked at the Jott service, it was somewhat unique—in fact, it was very unique—and
       related story at right).                    the users raved about it,” Thompson says. “Those two points were what got us very
          Nuance’s acquisitions, which have        excited about connecting with the management team.”
       sometimes been preceded by submit-             The combined Nuance and Jott teams will focus on several key voice-to-text initiatives:
       ting target companies to legal action          • To further extend the power of Jott across the mobile mass market, Nuance plans to
       for alleged patent infringements, have      package and offer Jott Assistant to mobile operators as part of its voice services portfolio;
       been the subject of complaints from            • Nuance and its Enterprise Unified Communications partners will offer a secure,
       some of its competitors. Whether these      highly scalable, and differentiated enterprise package that includes Jott services; and
       complaints spurred the Justice Depart-       
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