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Pristine Blog

The Economics of Google Glass in Healthcare

Posted by Lucas Schlager on May 28, 2013 5:10:30 PM

This post was originally featured on HIStalk

A lot of people think Google Glass can be used as a development platform to create amazing healthcare apps. So do I.

Many of these ideas are obvious, and many of them could be relatively simple to develop. But we won’t see most of them commercialized in the first year Glass is on the market, maybe even two years.

The most obvious analogy to Glass is the iPhone. It’s a revolutionary new technology platform with an incredible new user interface. Glass practically begs the iPhone analogy. Technologically, the analogy has the potential to hold true. But economically, it does not. Because of the economics of Glass, many of these great ideas won’t see the light of day any time soon.

First, there’s the cost. Glass will run a cool $1,500 when it lands in the US this holiday season. There’s no opportunity for a subsidy because Glass doesn’t have native cellular capabilities.

Second, and even more importantly, Glass needs to prove compelling given that you already have a pretty incredible smartphone in your pocket. When the iPhone launched, it competed with the non-consumption of 2007: dumb phones. Glass has to compete with a whole new class of non-consumption: iPhones and Androids. That means Glass has to be so incredible that you’re willing to spend $1,500 given that you already have an amazing smartphone in your pocket.Glass only provides marginal value. It’s a tough sell.

Take another look at the Google link from earlier in this post. Would you pay $1,500+ for any of those individual applications? Probably not. As a hospital CIO, would you pay $1,500+ per employee for hundreds of employees for any of those applications? Probably not.

Although these are all good ideas, the vast majority of Glass ideas aren’t compelling enough to justify the cost of Glass itself. This is inherently true in all Google Glass application markets, both consumer and enterprise. It’s especially true in healthcare given the additional costs of integrating into existing systems and processes.

Doctors in outpatient clinics face a similar challenge. Though some physicians, and perhaps some surgeons, will shell out $1,500 early on, most doctors won’t be willing to commit that kind of capital. I’m sure many physicians would feel concerned about making their patients feel socially uncomfortable, even if a given application proves clinical and financial ROI. But at some point down the line, doctors will probably adopt a Glass-like technology platform, especially with something like the MYO Armband. The human computer interaction (HCI) opportunities with a Glass+MYO armband areendless.

Over time, an increasing number of Glass healthcare apps will become available and the price of Glass and its competition (I’m looking at you, Apple. Also, learn why there will be no iWatch) will fall. Eventually, healthcare app developers writing on Glass will find success, but very few will in the first year Glass is on the market.

That does not mean that the Glass ecosystem is destined for failure. Glass has the potential to solve big problems. Capitalism dictates that app developers will figure out how to use it to solve big problems.

My favorite VC proverb is, "Provide pain pills, not vitamins." For every painkiller Glass app, there will be dozens of vitamins. The painkillers will drive the success of this platform. No one needs to buy Glass. But Glass can help people and create new efficiencies in enterprise markets such as healthcare, education, manufacturing, transportation, construction, gaming, tourism, and many others.

I’m incredibly excited about Glass. It will change the world. Maybe not in its first year on the market, but it will. No one thought much of the iPhone in its first year on the market, but it delivered a revolutionary new user interface and provided a new technology platform that app developers will extend to solve an enormous number of previously unsolvable problems. Glass will, too.

Glass developers, off to the races!

Topics: The Pristine Story