How will mHealth business models evolve 2010-2015?
Mobile health applications experience a second hype phase after first enthusiasm in the early 2000s. In 2011 there are uncounted conferences which focus on mHealth and the GSMA conference in Barcelona this week offers a special track on the potentials of mHealth applications. Companies like Qualcomm, HP, and Orange are trying to position themselves for the time when the market will take off. But how will mHealth apps generate enough sustainability to meet the rising expectations during this hype phase?
By looking back a few years we already see how the business will evolve. Business models of traditional mHealth solutions which long existed before the smartphone app market hype already showed the revenue sources which will become important in the future. Traditional mHealth solutions from 2000-2008 have typically been sold in bundles which include connectivity charges, a device, and the application and/or service charge. In the more sophisticated traditional mHealth solutions the price for the application and the application sales revenues were minor contributors to the total revenue generated by the solution. Frequently the price for the app was not even disclosed.
Revenue sources for mobile health applications
The first generation of mHealth solutions in the new smartphone applications market have adopted a narrow range of business models, concentrating on revenues generated from application download sales, and subscriptions for content access over a period of time; average of 4-8 USD per download depending on the app store. In a very few cases publishers have linked the application to a device/sensor or service, such as the WiThing Scales Sync which provides a free application for use with a scale which is sold through the publisher’s website.
Business models for mobile health apps & technology
The business model will broaden once more when the enabling technology becomes sufficiently advanced. Sensors and special devices that are designed to take advantage of the smartphone interface will facilitate more advanced applications, and at the same time healthcare industry players with the capability of providing complex service offerings will enter the market. These factors will allow revenue generation through multiple sources apart from application downloads including for example through service charges for HCPs remotely monitoring patients’ health condition, or through product sales for special devices and sensors that relate to an application’s functionality.
As the market develops, applications will facilitate the sale of products and services such as medications through a compliance application or a mobile pharmacy application. These device and service sales will become the major revenue source for mHealth application providers by 2015.
Advertising revenues will become a revenue stream as it will across the smartphone application market and will add to the mHealth providers’ income but only to a little extent.
As opposed to the traditional model, connectivity will not be part of the bundle as most smartphone users will already have some kind of data plan.
Today’s dominant pay per download business model will give way to those other revenue stream. Developers of mHealth applications should be aware of that and adopt their products and service accordingly
To see more details on the future trends in mHealth business models please have a look at the “Mobile Health Market Report 2010-2015”.
UPDATE: Our 4th mHealth Developer Economics survey is finished.
You can download the report for free. Just click on the picture below.
MHEALTH REPORT: The “Global Mobile Health Market Report 2013-2017 is a business guide for traditional healthcare companies as well as for mobile operators who want to successfully engage into the new mHealth market. Country mHealth market reports are available forUSA, Germany, Brazil, Japan and UK. See report preview.