Alphabet, Amazon, Apple, and Microsoft are gunning to carve out spaces within the healthcare market. Each is targetting its own set of sectors to transform or disrupt. But their inroads into the healthcare space may be stymied by consumers’ meager trust in tech companies handling their health information. The tech giants’ forward march into healthcare is, in some cases, troubling to incumbents. Let's have a look at some of their activities, initiatives and possible digital business models.
Healthcare has always been a complicated and financially expensive sector. Enterprises alone spend over $9 trillion annually on healthcare in the U.S., or $47,000 per household. As such, it’s no wonder that many have been wondering how they can help solve the sector’s problems. Advances in artificial intelligence, blockchain, and other technologies are transforming the delivery of healthcare at a rapid rate. These new solutions have the potential to improve access, increase efficiency, and reduce costs.
In this blog, we explore how tech giants are intending to transform healthcare and how the technology will shape the industry in the future.
Alphabet: Derm Assist to Identify Skin Conditions
Alphabet has been investing in healthcare for years, and it’s not alone. We have recently described the Derm Assist app. It uses AI to detect skin lesions and provides a list of possible conditions (including cancer) from which the user can choose. The program then assigns an appropriate treatment protocol before sending you on your way.
The acquisition of Fitbit by Alphabet last year is just one more part of their strategy to exploit the healthcare sector. The combination of Fitbit's leading technology, product expertise and health and wellness innovation with the best in AI, software and hardware from Alphabet shows another way how tech giants might get a foothold into healthcare.
A recent project of Google Health (a subsidiary of Alphabet) aims at diagnosing and preventing blindness. The Automated Retinal Disease Assessment, or ARDA, is a tool that uses artificial intelligence to help healthcare workers detect diabetic retinopathy and may eventually be used for detecting other eye diseases.
Microsoft Cloud to Optimze Healthcare Processes
Microsoft announced advancements in cloud technologies for healthcare and life sciences with the general availability of Azure Health Data Services and updates to Microsoft Cloud for Healthcare. The improvements are designed to transform the healthcare journey, using AI to give full visibility into data, reduce provider administrative burden, boost productivity for care teams on the frontline, increase workflow automation that can improve quality of care, reduce clinician burnout, and deliver better care faster and at a lower cost.
Speech recognition and text analytics to enable clinicians processing and extracting information from medical records as well as optimizing workflow and reporting are just a view examples. Ideally, so their vision, the health data across different systems are used to predict risk, accelerate care decisions, and help drive better health outcomes. While none of these projects are fully complete yet, it’s clear that microsoft is putting clearly its stake into the ground.
Amazon Care for Advancing Telemedicine
Amazon has spent years developing Amazon Care, a telemedicine service. It allows doctors to provide in-home services and advice to patients using video feeds, live chats, and other digital methods. One of the most interesting aspects of Amazon Care is that it also connects patients with a network of board-certified doctors in their area for routine checkups, appointments, and advice. The system offers access to consultations with specialists from around the country or world.
Amazon Care was launched in 2019 and will be available in more then 30 US cities.
Apple's Health App to Organize Health Records
Also Apple has been actively pursuing healthcare solutions. They developped a Health app, which consolidates your health records and makes it easier to diagnose and treat conditions. The app can collect data from various health monitoring devices or use barcodes for prescription medication to gather information and help you manage your health. Since last year, iPhone users have the option to securely share data from their Health app directly with their doctors through their electronic medical records.
In addition, Apple partnered with the prestigious Mayo Clinic to offer deep integration with their Apple Watch wearable device, which can detect irregular heart rhythms and notify users when they’re about to go into atrial fibrillation.
Challenges of Digital Business Models in eHealth
The examples provided here are not unique (and not ment to be comprehensive). Smaller start-ups, Biopharma and healthcare providers are also looking at new digital business models in eHealth and there are plenty of success stories to be seen. But the interesting observation of these tech giants is that they all use a typical pattern of digital business model design: through combinatorics of innovation and ubiquity of knowledge, industry boundaries are dissolved. In other words, today's rapid technology development coupled with extensive knowledge available to everyone makes the barrier to breaking into a new industry much lower.
Do the four tech giants pose a risk to traditional healthcare companies? The SWOT analysis shows that yes, but no. Obviously if it comes to digital technologies they are leaders in this market and show how these technologies can be applied on solutions for the health care industry in large scale.
In their current attempts, they are far away from their business models that once made them game changers. For example, Google Health's Derm Assist is a brilliant example of how to use AI for diagnostics in dermatology- but it will not replace advanced diagnosis techniques such as biopsies and the experience of dermatologists. It only targets one specific aspect of first line diagnosis- which means it will be insufficient to dominate dermatology like Google Search does with internet search engines.
Apple has disrupted the music and mobile phone industry. Apple's iWatch generates revenues in the order of magnitude of the entire Swiss watch market. Neverthess, it cannot replace sophisticated clinical diagnostics. The hurdle for a sector disruption in healthcare is the inheritable fragmention due to the many diseases and not to forget the particular high risk. But the tech giants need scale in a cleary defined and homogenous industry segment. In essence, their efforts appear yet rather like testing the waters from a very digital technology driven perspective.
Apple has disrupted the music and mobile phone industry. It is generating revenues with the iWatch ecosystem in the order of magnitude of the entire Swiss watch market, yet it can't replace more sophisticated clinical diagnostics presently. The hurdle for disruption in healthcare is inheritable fragmentation due to many diseases and not to mention the high risk in development. Nonetheless, tech giants need a scaled-in niche industry segment that's clearly defined with no homogeneity lost from their digital technology perspective. Tech giants' efforts are still rather like testing out waters - this industry is new territory for them so their approach will have to be different than what they were used to before on familiar ground with clear boundaries where things were homogenous and straightforward with digital technology being at play.
Nevertheless, this should not lead to ignoring their efforts. Their path to diagnostics, clinical operations and improved treatment outcome for patients might be not particularly sophisticated from the point of view of a clinician or pharmacologist. But they may quickly dominate the healthcare market exactly in these fields, first-line diagnosis, clinical operations, patient records and alike and may leave the more complicated and fragmented aspects to the specialists. Therefore, it is essential for the traditional healthcare industries to develop their digital capabilities beyond using computer power and software. They need to embed their new diagnostics, medical products and therapies in digital business models in order to create the most possible value as well as to keep new players at bay.
Healthcare is in a state of flux. With the advent of new and digital technologies and its ever-increasing presence in our day-to-day lives, it's only natural that tech giants are looking to the future of healthcare and how they might be able to play a role in advancing the industry. Vice versa, it should be natural for the traditional healthcare industry to look how to utilize digital technologies too.