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Nuance & Microsoft Team Up on Conversational AI for Doctors’ Offices

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orthopedics and dermatology. It’s tackling specialties first because they have “fewer chief complaints” and “tend to be more predictable in terms of what’s being discussed,” Harper says. Once the technology masters patient visits for 23 outpatient specialties, Nuance intends to deploy it in primary care and “acute care” settings, he says.

“The reason we’re going in that direction is when you see a primary care physician, what are you going to see them about? It could be anything,” Harper says. “By having all this data for the first 23 outpatient specialties, it will be a huge starting point for us.”

Protecting sensitive health data could be a concern with ACI. Harper says patients must give explicit consent for the device to record conversations with caregivers, and the audio data are encrypted both during transfer and when they are “at rest,” Petro says. The device also has a camera that uses infrared lasers to better track who is speaking, but Harper says the camera can be turned off, the video data stay on the device, and the footage only shows heat signatures and outlines of people, so they’re not identifiable. Petro notes that Nuance handles billions of health data points each week with its existing services, and he says its practices comply with patient privacy and security laws.

The commercial rollout of ACI comes as the company navigates a significant reorganization of its business. At the beginning of October, Nuance spun out its automotive division into a publicly traded firm called Cerence (NASDAQ: CRNC), which has a market value of about $580 million. Nuance retained its healthcare business and its enterprise division, which helps businesses build conversational interfaces with consumers, such as customer service chat features.

Nuance, currently valued at about $4.3 billion, has a lot riding on ACI. It views the product as a meaningful advancement of its speech tech for healthcare, and will offer it as an upgrade for its Dragon Medical One customers, Harper says. If the new product works well, it could help retain and perhaps increase Nuance’s significant healthcare customer base. (Petro says about 90 percent of the hospitals in the US and more than half of American physicians use at least one Nuance product.)

But if ACI fails, it could deal a blow to the company’s foothold in the market. In addition to getting the technology right, Nuance will have to fend off competition from companies such as Suki, Saykara, Sopris Health, and Notable. One also has to wonder whether other tech giants that are investing heavily in speech recognition and other AI technologies, such as Amazon (NASDAQ: AMZN) and Google (NASDAQ: GOOGL), might try to compete with Nuance’s ACI. Google reportedly has done some work in this area, but it doesn’t appear to have brought such a product to the market.

Harper likes Nuance’s chances regardless of whether the competition gets stiffer.

“Our customers believe we’re the ones who can do this because we are their trusted advisor,” Harper says. “We’ve been selling to them for a long time. We know what we’re doing with the data.”

Still, Petro acknowledges that healthcare is a difficult industry to change, and this is a complicated product to get right.

“This is going to be a journey,” Petro says. “We’ll make some mistakes along the way.”

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