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Amazon 'mulls' deeper health tech invasion with stealth skunkworks

E-marketplace giant looks to levy Alexa success for consumer healthcare

By Rebecca Hill, 28 Jul 2017

Analysis Amazon is gearing up to take advantage of the burgeoning market for personal healthcare technology, but has been warned not to underestimate the power of the incumbent enterprise market in hospitals.

The e‑commerce giant has been running a skunkworks lab called 1492 that’s dedicated to healthcare tech, and is advertising for roles including a machine learning director with experience in healthcare IT, it's reported.

We're told the lab was developing software and hardware, with an emphasis on creating the infrastructure to manage electronic medical records, provide remote doctor visits for patients and build products to work with its smart speaker Amazon Echo.

The idea is to harness the success of voice-controlled personal assistant service Alexa and trade on the increasingly commoditized nature of personal healthcare.

It has already made moves in this direction, and in March struck a deal with the US health website WebMD to access health information directly through Alexa – aiming to effectively put a stop to people’s reliance on Googling their symptoms.

Analysts and commentators told The Reg they were unsurprised by the e‑commerce giant’s interest in the healthcare market.

Gartner analyst Anurag Gupta said the field was ripe for disruption. This is partly because of the “asymmetric information” balance in the sector – where patients have significantly less information than their clinicians do – and the idea that patients are steadily “morphing into the healthcare consumer,” he said.

However, Phil Booth, coordinator of campaign organization MedConfidential, said that Amazon’s ethos was that “brutal mechanics can provide cheaper service – it’s unclear how that will go with people who are unwell and in need of some measure of empathy.”

He added: “Amazon’s primary goal is to sell more stuff through Amazon, and that’s going to lead to some very perverse incentives.”

Low-hanging fruit

Gupta – who has not been recently briefed by Amazon – argued that the firm was in a good position to make inroads elsewhere in the healthcare sector, but should learn from others’ mistakes.

“One of the biggest problems is the enterprise market [in hospitals] – they have a big influence and hold a big CIO mindshare,” he said. “Some of the big firms have not got a very successful record in healthcare because they faltered in this space.”

The reason for that is partly because they “underestimated the power of the [Electronic Medical Record] guys and the enterprise heavy guys.”

If Amazon is serious about continuing its growth, Gupta added, it would also have to start acquiring smaller firms. But he added that the e‑commerce giant has been establishing itself as a player in the backend space for some time, and was “not playing catch-up” to the giants like Microsoft and Google.

For instance, some big medicine and healthcare names such as Philips and Deloitte are using Amazon Web Services.

Amazon has already been making moves to strengthen its cloud business – which Gupta said was “low-hanging fruit,” given the increasingly data-driven nature of healthcare.

On Monday this week, PharmaPhorum reported it had hired Missy Krasner, managing director of corporate cloud Box’s healthcare and life sciences division.

And on Wednesday, Amazon was said to be planning an investment in health startup Grail, which aims to use deep sequencing to detect cancer in the blood. ®

The Register - Independent news and views for the tech community. Part of Situation Publishing