Welcome to the new SEXY healthcare-ians who joined our tribe this week!
I sit here on the cusp of a new year looking in the rearview mirror with thanks it’s in the past.
Tomorrow officially we can say for the first time in history, hindsight really WILL be 2020! We’re all making resolutions…
Not the point...
Anyway, our topic today is one we will be seeing MUCH more of in the near future.
More specifically...big tech in healthcare.
Ever heard of FAMGA? No? Even if you haven’t heard the acronym you've heard of who it stands for.
Facebook, Amazon, Microsoft, Google, Apple.
Their combined valuation is just over $4trillion .. TRILLION. (in the US healthcare itself is only a $3t industry..)
The top 5 biggest US companies (others are encroaching yes...Tesla, Netflix, etc)
And it’s many other companies’ sole purpose to analyze and predict the next strategic moves of these companies based on their past performance.
Annndddd everyone is throwing their money in the pot that all of them are edging their way into healthcare.
I mean could you blame them? Digital health saw its heyday this year, healthcare is RIPE for disruption and gosh… the healthcare data market alone saw 36% compound annual growth. Crazy. And only growing more.
Big tech companies are situated perfectly to start this disruption. And I’m not saying they JUST now started inching their way into healthcare...it’s been a long time coming… but with so many gaps to fill in the current system, don’t you think that trillion dollar companies with mucho to spare and invest, might eye those holes as their next big endeavors? I certainly do. This year gave way to heaps of opportunity.
The question here remains though...will it be for good, or for not so good?
Let’s look at the pros, starting with what are some of the things they’re currently digging their claws into.
Facebook - Mark and Co are capitalizing on their extensive and unique data sets of people, using groups to combine people with like minded health and wellness interests. And with their portfolio of tech companies, they are likely to become the ‘digital front door’ in many emerging countries.
Amazon - They’ve made the biggest moves this year. They have huge infrastructure build, and many loyal fans as members of Prime. For one, adding a Care Hub to Alexa for American customers where two Alexa’s can be connected to allow family to keep an eye on elderly members. The introduction of their hardware wearable device, the Amazon Halo. They’re moving into insurance with Verily, direct primary care with Crossover health, prescription delivery with the acquisition of PillPack and AWS develops a healthcare data repository.
Microsoft - Back end infrastructure and IT are the winning spaces with them. Microsoft Teams allows workers to interact seamlessly. Their name is one of the most trusted in the tech industry, Azure backs and secures many apps to allow healthcare to easily deploy new solutions, and Cloud for Healthcare is their most recent launch, allows seamless data sharing to improve outcomes of patients and increase flow efficiency.
Google - Invested heavily in digital health during this past year. Their search capabilities and HUGE repositories of data and information make medical record search easier, integrating with EHRs and leading the charge with AI capabilities. They’re facilitating a better search experience across the board, including for medical researchers. And they acquired the popular fitness tracker FitBit.
Apple - Tim Cook is famous for saying that if they look back on Apple’s journey, their biggest contribution will have been in healthcare. I’m sure most of you have an iPhone and also utilize the Apple Watch or Health Kit, still the most popular wearable tracker on the market. They’re making a move into democratizing healthcare, allowing easy access into our medical records and allowing us to easily ‘quantify’ ourselves.
And to no surprise, they’ve even initiated partnerships amongst themselves! Hooray friendly collaboration of competition.
(all info derived from CBInsights Report on Big Tech in healthcare)
Okay now...let’s look at some cons. Here we find the story of the steamroller.
Amazon for example. Came across this interesting article from WSJ and read the story about how they handle some rivals. Now, yes, Jeff and Amazon’s business growth strategy is flawless. Reinvest earnings, invest, expand, acquire, grow...it’s the foolproof operational system businesses strive for. But their hyper aggressive approach can mean trouble for other smaller businesses. Right now, they have their eye on smaller (still big) competitor Shopify. And in the healthcare sector, they have the resources to overrun really anyone, and they seem to be eyeing telehealth. But what really caught my eye was the way they supposedly treated an FBA seller who was getting too big for Amazon’s liking. A tripod maker and photographer equipment seller started to gross over $3M yearly on the platform. Amazon took note and began selling similar ones under Amazonbasics, from the same manufacturers, the same design, but at a much lower cost. Amazon eventually suspended the selling of the seller’s tripods alleging it had ‘authenticity issues’ even though the Basics version came out as a replica of the sellers.
Now this isn’t an exact replica of what could happen with other competitors but, what happens if they decide to jump into say, telehealth? They implemented it for their employees, with very likely next moves to expand. Well probably the above scenario. Big tech companies also have the resources to facilitate M&A (mergers and acquisitions) of any and all startups they need to complete their gaps instead of creating the department from scratch and taking time to develop the processes in house. Which is great for those companies getting 7 figure exits, but this consolidation only increases their power. The steamroller is just an analogy of how they can carve their way in the market.
So more importantly, what does this mean for you? Well you’re going to be using them more and more...and even more...than you already do. Everything will be interconnected between these companies and they’ll start popping up with new offers everywhere.
As a pro, things will become even more connected, integrated and convenient. You can order prescriptions directly from Amazon Prime, telehealth visits will become part of your member benefits and you can grab in person services at Amazon care clinics near you. All included. All connected. Streamlined payments. But what about your data?
There are many privacy and security laws in place for the sharing and exchange of private health data. Though, historically, they only apply to designated healthcare companies. And as none of the above are actually healthcare companies, there are quite a few holes they can slip through to avoid regulation. Not saying it will happen. They've been promises of protection and fair use. Time will tell what other policies emerge from the new landscape.
Obviously, as this newsletter stands for, we want to see change in the system and reform, and if FAMGA can help us get closer to that than HOOZAH. Amazon alone , Jeff Bezos, has everything they need to revolutionize the industry. They’re sitting on a mountain of data and monetary resources to catalyze the change deemed necessary after the pandemic of 2020. He reinvested their earnings and seized the opportunity only to continue seeding their soil into healthcare.
But at what price? Price for other companies? Price for our own private health data in their hands (data privacy laws are another rabbit hole)? Are they to be trusted? The good thing about being a savvy healthcare citizen and consumer is...this is all your choice.
Happy new year friends and may the force of 2021 be with you!
Have any thoughts or suggestions about this or any past newsletter? Want a topic covered or question answered? Or shoot, even if you want to CORRECT me! Comment below or hit ‘reply’ directly to the newsletter!
Also, I’m experimenting with Twitter. Let’s give each other a shoutout! Tweet me your biggest predictions for healthcare in 2021! @nikkicohnbyrd
(remember, this in no way serves as medical, financial or legal advice)
To making healthcare sexy again,
LI: Nikki Cohn-Byrd