While Microsoft and Yahoo trade bitter press releases capable of being written only by the embittered and the scorned, Google marches forward in product leadership.
Google Health was introduced to the public today at the Google Search Factory tour. Ample news coverage has preceded the (delayed) launch. This is a large target. Health care spending represents around 15% of U.S. GDP, or nearly $2 trillion dollars. Depending on which estimates one uses (such as here) administrative expense represents up to 31% of that number.
This was the earlier vision of Healtheon, now webMD. Google appears to have made great advances where Healtheon stagnated, which is the participation of health care providers to join into the system. Even small issues such as the NAME field can be represented very differently by different providers - one field, two: first, last, two: last, first. What to do about middle initials? How to resolve this? Google has the participation already of Pharmacy providers Walgreens, CVS, Longs bodes well for pushing the most reluctant sector, doctors, to join allowing secure data transfers. This isn’t a new problem, many companies such as Revolution Health have tried to solve this problem but by having doctor’s offices pay for it through paying to automate their systems on a proprietary platform. That was a tough if not impossible nut to crack. To have a more open system which Google presumably will monetize as always with context-specific ads clearly was the way to go. However, HMOs were notably absent from the presentation.
Marissa Mayer concluded the Google Health presentation mentioned there are thousands more partnerships to go, and “petabytes” of data that need to get into users hands. But if the engineering wizards have built an easy enough system for providers to sign up for without the overhead and specialization of a business development effort, it could succeed.
The biggest objection will undoubtedly be privacy concerns. Whimsically Google introduced Google Walk with the Cleveland clinic. You can drop this widget into iGoogle to track the amount of walking you do. This sound trivial, if not trite, but is the type of comfort-inducing outreach to a mass audience that helps build trust in the user base. No link is available yet at google.com.
Google is trading now at 580, with expected earnings this year around $20. That’s a 190 billion market cap. What contributing to solving the health care administration cost crisis would add to that is anyone’s guess but it will undoubtedly be significant. Google had traded down when Microsoft and Yahoo first courted, thinking critical mass would provide ammo against Google. This is another demonstration of how irrelevant the competition to Google has become.
