Jawbone's BodyMedia Buy: Wearable Monitors Heat Up
Investors eye the growing wearable health device market as sensors become more sophisticated and deliver more health information to consumers.
10 Wearable Health Gadgets
(click image for larger view and for slideshow)
Jawbone's acquisition of BodyMedia, a leading vendor of wearable health monitors, has drawn renewed attention to the potential of the mobile health market. Although it's not clear whether a wave of consolidation lies ahead, the purchase of BodyMedia underlines the rapid growth of the "quantified self" consumer market.
Long known for its Bluetooth audio speakers, Jawbone burst into the mobile health products space in 2011 with its Up bracelet, which tracks a user's movement and sleep patterns and displays the results on a smartphone. Jawbone just announced an iOS app platform on which 10 outside partners are integrating their apps with its device.
BodyMedia, one of the oldest firms in the wearable sensor field, was founded in 1998. Its Fit armband, which has been approved by the Food and Drug Administration (FDA) for weight loss, helps users track weight and calorie intake, as well as activity and sleep. Its Core 2 armband, set to launch later this year, can track a user's heart rate, temperature, heat flux, sweat and motion, according to MedCity News.
BodyMedia has been featured on the NBC-TV show "The Biggest Loser" and also has partnerships with Jenny Craig and Apex Gyms, MobiHealth News reports. In January, the company launched a pilot with Cigna, which wants to use its devices in diabetes prevention and management. BodyMedia holds 87 patents, along with a staggering amount of data generated by its devices, according to a news release.
All of this made BodyMedia an attractive target for acquisition. But the real opportunity for Jawbone lies in BodyMedia's depth of experience in wearable monitors and its understanding of analytics, said Mohit Kaushal, MD, a partner in San Francisco-based venture capital firm Aberdare Ventures, in an interview with InformationWeek Healthcare.
With multiple sensors, advanced analytics, the right interface, and the right behavioral science for presenting this information to consumers, Jawbone and BodyMedia could help improve wearers' health, said Kaushal, who is the former chief strategy officer of West Health Institute.
The de-identified data in BodyMedia's database also could be valuable, he said. Although there's no way to connect this information with clinical data, he noted, the sensor data could provide value on its own. For example, he said, "if you can capture a person's weight, how much exercise they get, and their hydration and diet information, that can create a very rich data source. You can use that data to create not only the analytics, but also the platform to message the results back to me and improve my lifestyle."
Venture capitalists have been showing an appetite for health IT, particularly in the consumer mobile health product market. Their nearly half-a-billion-dollar investment in the sector during the first quarter set a record.
"Our healthcare system is going through transformational change. So it's not surprising that the technologies and tools that enable that transformation are getting a lot more interest and traction in the investment community," said Kaushal.
Will BodyMedia's acquisition boost the value of similar companies? Absolutely, said Kaushal. "Acquisitions are a good thing, because it shows there's a market need and a wish to value those types of products," he said. "The space has been growing for the past couple of years and waiting for acquisitions. Aetna's purchase of iTriage shows how the space is evolving and maturing."
Nevertheless, Kaushal would not predict whether the wearable monitor field or any other consumer play will be a big beneficiary of investor interest in the next year. What he does forecast is that there will be big growth in "information-based companies in healthcare," whether they target consumers, providers or payers.
In Kaushal's view, this is all about healthcare transformation. "Services and technologies that enable that transformation, in our opinion, will be held in really high value by the marketplace."
InformationWeek Elite 100Our data shows these innovators using digital technology in two key areas: providing better products and cutting costs. Almost half of them expect to introduce a new IT-led product this year, and 46% are using technology to make business processes more efficient.
The UC Infrastructure TrapWorries about subpar networks tanking unified communications programs could be valid: Thirty-one percent of respondents have rolled capabilities out to less than 10% of users vs. 21% delivering UC to 76% or more. Is low uptake a result of strained infrastructures delivering poor performance?
InformationWeek Must Reads Oct. 21, 2014InformationWeek's new Must Reads is a compendium of our best recent coverage of digital strategy. Learn why you should learn to embrace DevOps, how to avoid roadblocks for digital projects, what the five steps to API management are, and more.