Overview of mobile health; opportunities and challenges for mobile health; mobile health platform design approach; platform competitive strategy; digital health; smart health

1. Mobile Health Platform Strategy
Gwanhoo Lee
Professor of IT Management
Kogod School of Business
American University, Washington D.C.
December 2016

2. A Trillion Dollar Question
How do we build a leading platform
for the mobile health sector?
2

3. Opportunities for mHealth

4. Healthcare Market Size
• USA: $3.78 trillion in 2018
• China: $1 trillion by 2020
(Deloitte 2016)
4

5. Disruption in Healthcare
• Input based to value/outcome based
• Patient-centered care
• Disease to health
• 30-50% decline in traditional healthcare services
• 85% of diagnostics move to retail
• Procedural services  commoditized
• Medical information analytics
• Genomics
• mHealth
5

6. Excessive Healthcare
Spending has become
a Global Issue
• 18% of 2015 U.S.
GDP
• 5.2% of 2011 China GDP
6

7. mHealth can lower healthcare costs
while improving quality of care!
7

8. mHealth Market Size
$60 billion by 2020
(Source: Market Research Engine, July 2016)
Connected healthcare products:
$285 billion by 2020
(Source: PWC, 2015)
$23 billion by 2017
(Source: Brookings, 2014)
e-health in China:
$3 billion in 2014 to
$110 billion in 2020
(Source: BCG, 2015)
$13 billion in 2015
(Source: SNS Research, 2015)
8

9. No one has yet developed a robust and
reliable business model that shows how
to make mHealth a successful venture on
a large and sustainable scale
(Malvey and Slovensky, mHealth: Transforming Healthcare, 2014)
9

10. There is no dominant platform
for mHealth YET!
10

11. (Brief) Overview of mHealth

12. mHealth
Provision of healthcare or health-related
information through mobile phones and/or
specialized medical mobile devices
(Source: The Economist, “Emerging mHealth: Path for Growth” 2014)
12

13. BAN (Body Area Network)
• Wearable body sensor
network
• Personal monitoring
device
13

14. mHealth Cloud Architecture
CLOUD
Source: Health Monitoring and Management Using Internet-of-Things (IoT) Sensing with Cloud-based Processing: Opportunities and Challenges,
Hassanalieragh et al., 2015 IEEE International Conference on Services Computing
14

15. mHealth
Applicati
on
Education
and
awareness
systems
Point-of-care
support and
diagnostics
Patient
monitoring
Disease and
epidemic
outbreak
surveillanceEmergency
medical
response
systems
Health
information
systems
mLearning
health
financing
applications
Source: Barton BMC Medicine 2012, 10:46
http://www.biomedcentral.com/1741-7015/10/46
15

16. mHealth Platform Strategy

17. 17

18. Platform vs. Pipeline
18

19. 19

20. Why Platforms Beat Pipelines?
• Scale and grow much faster
• Create value using resources they don’t own
• Network effect > Price effect or brand effect
20

21. Platforms and Two-Sided Markets
ProducersConsumers
21

22. Network effects – the main source of value
creation in a platform business
22

23. What industries are likely to
be disrupted by platforms?
• Information intensive
• Non-scalable gatekeepers
• Highly fragmented
• Information asymmetries
Healthcare?
23

24. What industries are likely to
resist platform disruption?
• Highly regulated
• High failure costs
• Resource-intensive
Healthcare?
24

25. mHealth Platforms
25

26. Two Important Markets for mHealth
1. Wellness/Activity Tracking
2. Chronic Disease Management
• cardiovascular disease
• diabete
• hypertension
• asthma
• obesity
26

27. Problems with Current mHealth Platforms
• No or little network effects
• Fail to engage users
27

28. Samsung S Health: Same-side Network Effect
28

29. Samsung S Health:
Cross-side Network Effect
29

30. Apple HealthKit: Same-side Network Effect
자료: 개인건강기록 산업, 표준 및 정책동향 TTA Journal, 2016.3/4
30

31. Apple HealthKit:
Cross-side Network Effect
31

32. Platform businesses require different
approaches and competitive strategies than
traditional pipeline businesses

33. Approaches to effective platform design
Define ‘core interaction’
–Participants
–Value unit
–Filter
33Source: Platform Revolution: How Networked Markets Are Transforming the Economy, 2016, Parker, Van Alstyne, & Choudary

34. Approaches to effective platform design
• Basic elements of ‘core interaction’
–Pull
–Facilitate
–Match
34

35. Approaches to effective platform design
• Modular design approach
35

36. Approaches to effective platform design
• ‘Anti-design’ approach
36

37. To grow user community fast, ‘Frictionless
Entry’ is the key
37

38. When Network Effect exists, it is
challenging to acquire initial users
• Chicken-or-egg
38

39. Strategies for Chicken-or-egg Problem
• Introduce platform to existing successful non-
platform business (Amazon)
• Piggyback (PayPal)
• Seeding (Android, Adobe)
• Acquire key producer (Xbox/Electronic Arts)
39Source: Platform Revolution: How Networked Markets Are Transforming the Economy, 2016, Parker, Van Alstyne, & Choudary

40. Strategies for Chicken-or-egg Problem
• Focus on a single-side first (OpenTable)
• Big Bang (Twitter)
• Start with micro-market (Facebook)
40Source: Platform Revolution: How Networked Markets Are Transforming the Economy, 2016, Parker, Van Alstyne, & Choudary

41. Platform Governance
• Laws, Rules
• Norms
• Architecture (eBay; Blockchain)
• Markets
41

42. Metrics
• Measure activities, not membership
• Actionable, accessible, auditable
42

43. Monetization of Your Platform
• Charging a transaction fee (Uber)
• Charging for access (Dribble)
• Charging for enhanced access (Yelp)
• Charging for enhanced curation (Sittercity)
Source: Platform Revolution: How Networked Markets Are Transforming the Economy, 2016, Parker, Van Alstyne, & Choudary 43

44. Whom Should You Charge?
• Charging all users
• Charging one side while subsidizing another (online
dating sites)
• Charging most users full price while subsidizing stars
or price-sensitive users
44Source: Platform Revolution: How Networked Markets Are Transforming the Economy, 2016, Parker, Van Alstyne, & Choudary

45. The one who controls data will control the mHealth
ecosystem
• Current health data are highly fragmented
45

46. Competitive Strategies for mHealth Platforms
• Prevent multi-homing
• Innovation first, then value capturing
• Leverage data
• Promote partnership
• Platform envelopment
• Design excellence
46Source: Platform Revolution: How Networked Markets Are Transforming the Economy, 2016, Parker, Van Alstyne, & Choudary