Free is Not a Business Model

“Free” is an attention grabber, not a business model.   Chris Anderson, author of the recently introduced book, Free! The Future of a Radical Price , understands the power of the word “free” on many levels (including using it as a catchy title).  But even he can’t justify giving away intellectual property as a business model.  Rather, he frequently recommends a “freemium” model, where some content is widely available for free with revenue coming from upselling leads.

I wrote my last article on the commoditization of health content, before the release of  Anderson’s book.  While I agree with most of his points—especially the fact that digitized content is subject to commoditization because of low marginal costs – it’s important to keep in mind that Anderson and others are only talking about a part of the picture.  Digital content and digital distribution may drive down prices over time, but they also increase the options available for packaging content for different audiences and applications.  So, while the basic bits may be commoditized, helping customers apply those bits to solve problems, close sales, or become more efficient remains a very valuable service. 

There is a range of options available to publishers to differentiate their content in the marketplace to retain value.  The best mix of free content, premium content, tools, subsidies, and value-added services will differ depending on the nature of the content and the size of the potential audience.  Very specialized content with a limited audience may do better with a premium subscription model; news content with mass appeal may be better suited to an ad-supported free-to-the-reader model.  In both cases, some content may be used for marketing purposes to attract and retain users.

To thrive in the digital economy, publishers need to rethink how their users value the information they provide.  What do these users do with the content?  What can you do to help these users become more productive or work more efficiently?  This is the essence of infocommerce, and many publishers still have not harnessed its full potential. Some are still stuck in the old mindset that they produce “textbooks” or “newspapers” or “journals”. Instead, they should be thinking about how their content can be integrated with software to offer decision-support systems, or how their content could be used by an online marketer to shorten the sales cycle.  

In the past week, infocommerce has been the subject on Andrew Savikas’s blog at TOC at O’Reilly Publishing - Content as a Service and  Matt Dickman, a digital marketer at Fleishman-Hillard  -  Content as  Commerce  . Both  stretch their ideas a bit too far in order to make their point, but they represent creative thinking about how to readjust the way we view the value of content.

Another phrase should be added to the discussion:  “Content as Advertising”.  Publishers need to gain a renewed understanding of their advertisers’ needs and consider how content can be used as a vehicle to engage prospects.  Using free content to attract leads and build brand equity isn’t all that radical if one looks at how this “content as advertising” is supporting (and in some cases supplanting) traditional branding and lead-generation methods.  We predict that as “content as advertising” and “content as commerce” continue to evolve,  the lines between publishers and marketers will blur as marketers learn new methods for using content online to attract new customers. 

[Note, although not specifically focused on health content, this article is particularly relevant to pharmaceutical marketers and OTC health and beauty marketers.]


Health Content is Rapidly Losing Its Value


The dismal state of the news publishing business is well known.  The competition in online news has become so intense that users now expect to receive general news for free.  It’s not a stretch to say that news stories that report the latest medical research results fall in the same category (and constitute the majority of health stories in general news outlets).  


This trend isn’t unique to news or health content.  All digital content is becoming commoditized.  Why?  The answer is complex, driven mainly by technology.  Good quality digital publishing systems are available for free (e.g., WordPess, open source CMS systems), thereby eliminating the cost of production and replication,  and distribution costs have been driven down to near zero with Web distribution.  These factors combine to reduce the barriers to entry, and as a result, the volume of digital content has exploded.  Marketers are giving away content to promote their goods and services; citizen journalists are blogging, texting, and Tweeting; and social media tools have made it relatively easy to build an audience for content.  Publishers, whose product is content, have to give away some of it to draw in users, but too often seem confused about what content to give away and what content to retain as premium content. 


This commoditization phenomenon isn’t contained to publishers.  As pointed out by Tom H. Lee, MD in a provocative article, “Commodifying Content Through IT: Could Physicians Be Next” in iHealthBeat last month, physicians are experiencing commoditization, too. Dr. Lee (who headed content development for Epocrates in its early days) posits that once the knowledge of doctors is encoded in computerized clinical decision support systems, the value of the physician who once had controlled access to the same information will decline.

Take for example, the use of nurse practitioners and other non-physician clinicians for many relatively routine tasks previously carried out by doctors.  Minute-Clinics and the like are prime examples where order sets are used to diagnose and treat common conditions.  (See Harry Bliss cartoon: The doctor’s nurse’s nurse practitioner will see you now).  Even self-diagnostic systems for patient use will become more commonplace over time as clinical decision support systems improve and gain acceptance as reliable diagnostic tools.   

Okay, so let’s accept that health news content is a commodity.  What about more specialized health content, such as fulltext journal articles, drug information, books, and other reference materials?  The evidence indicates these categories are approaching commodity status, too.  How fast they are de-valued depends on how easy it is to recreate or reproduce the information and other barriers to entry. 


In today’s market we’re often willing to pay to find content, but not for the content itself.  Rewards for creating content are declining relative to the rewards of creating new technology for processing content. 


What should health content publishers - and healthcare professionals - be doing to maintain their value in the face of technology-driven commoditization?  In short, they need to “move up the value chain”.  Sometimes just aggregating related content and making it accessible at the point of need is sufficient added-value to extract a premium.[1]  Other times, investing in creating sophisticated workflow tools or analytic engines that integrate content with IT to guide users to optimal solutions may be necessary to produce sufficient value in today’s market.  So when it comes to technology, publishers need to embrace the opportunities to enhance their content and expertise with appropriate technology and make IT their friend before fear of technology defeats them. 



[1] Just yesterday, I discovered that TauMed, a health news aggregator has shut down and its founder now works at EveryZing.  Clearly, aggregation services that operate in a crowded space face commoditization as well. 


Google Health: PHRs Still Need Human Touch

Google has been very good at establishing a broad-based platform for search and search advertising.  However, they’ve always taken a “hands-off” approach when it comes to content.  Google doesn’t get involved in the dirty work of “data cleansing”, especially when it requires domain-specific knowledge and human intervention. Instead, Google focuses its resources where they can rely on existing metadata to fuel their engineering powerhouse. 

Therein lies the problem that came to light this week when the Boston Globe ran an article that detailed the experience of e-Patient Dave (Dave deBronkart) in transferring his medical record info from Boston’s Beth Israel  Deaconess Medical Center (BIDMC) hospital to Google Health, the highly anticipated personal health record (PHR) utility from Google.  Dave described in the Globe article and on the blog some of the unacceptable outcomes that occurred when Google inferred information from content that was imported into his Google Health PHR from electronic records at BIDMC.   For instance, dates did not accompany most of the information, so Google Health issued alerts that assumed all of the conditions and meds listed in his record were occurring simultaneously. 


The article also highlights serious flaws in using medical billing codes to infer information about medical conditions.  E-Patient Dave delves more deeply into the medical coding issue on his blog and offers a good round-up of the various codes used by medical providers.  These billing codes are imperfect for their primary purpose; using them as the primary metadata to infer a patient’s medical history is a fatal flaw.

So, should we conclude that Google Health is a DOA as some have suggested?  Not necessarily.  But, I think it may be fair to say that Google Health isn’t ready for the average patient/consumer and won’t be until more progress is made in harmonizing the codes and terminology used by various stakeholders in the healthcare economy. 

One conclusion is clear:  given the current stage of development of PHRs, there are opportunities for content intermediaries in healthcare to solve some of the data inconsistency problems.  One new company,  Zweena Health, added its voice to the Google Health bashing to promote its own service that creates PHRs for individuals.  According to their site, they “do all the work” to convert information from providers into a usable information resource. 

Traditional healthcare publishers represent another group that is well-positioned to help solve the data translation and transfer problem for patient records.  Healthcare publishers like Elsevier, ThomsonReuters, and Wolters Kluwer have been combining content with technology to create clinical and workflow tools for years.  Their expertise in understanding content, technology and workflow of healthcare professionals should be included in efforts to develop electronic records for providers and patients.

Finally, medical librarians have expertise and hands-on experience in translating medical information for consumer audiences.  Perhaps it is time for Google to fund medical librarians to take on the work of creating taxonomies and harmonization schemes that would better serve multiple stakeholders.  I’ll forward this post to David Rothman and other medical librarians who blog to get their feedback.

One final thought.  Google likes to aim high and target projects that reach large numbers of people where Google can add value through low-touch high-tech projects that leverage their computing and coding resources.   In the case of digital health records, perhaps Google should take the approach that CMS has used and tackle a smaller piece of the puzzle first, starting with drug information.  Digital drug databases have evolved to a state where they are more reliable and CMS is advancing e-prescribing by providers through financial incentives and promotions.   This week’s announcement that Express Scripts is acquiring Wellpoint’s NextRx pharmacy benefits management (PBM) unit for $4.68 billion is another sign of progress in this arena.  The market apparently approves of the acquisition:  Express Scripts’ stock price has risen since the announcement and has been upgraded to a buy by UBS.

As we wrote last month on the subject of health IT, it is imperative that architects of the health IT software systems understand the content that will flow through their systems and how it will be used.   The same imperative applies to developers of PHR software and tools to an even greater extent, because of the need to translate or explain medical terminology for consumer audiences. 


Health Content Needs to Drive Health IT Investment

There is plenty of buzz about the $19.2B in stimulus money earmarked for health IT, some of it positive (see here, too) and much of it negative.  The positives focus on the improved efficiency of electronic medical records (EMRs) that will improve outcomes and minimize medical errors and adverse effects.  The negatives focus on poor design of existing EMR technology and the reluctance of physicians to adopt medical records systems that require substantial investments in time, money, and behavior change. 

Research Customer Workflow

Both sides agree that digitizing records and automating information flows is a good idea, but the skeptics emphatically insist that the workflow of the intended users be studied before the interfaces, navigation systems, and methods for data entry are determined. Simply stated, health IT vendors need to involve physicians more directly in the design of EMR systems. 

Incorporate Content to Drive Adoption

Expert opinions from both sides of the argument touch on-but don’t clearly articulate-the importance of incorporating health content into the development of health IT systems; and that the content has to include external as well as internal data in order to be “mission critical.” Content-driven systems such as Epocrates and UptoDate demonstrate that doctors will flock to digital systems that offer useful information on an easy-to-use and convenient platform.

We at Health Content Advisors have been involved in transforming print-based content to online information tools for over 20 years and have been living by the mantra that technology + content = “data that can do stuff”.  For instance, we have witnessed the productivity-enhancing benefits of transforming a print buyers guide into an online e-commerce site that not only helps buyers find the right goods and services, but also includes tools that compress the sales cycle.  So we understand that digital information systems in the health industry will lead to better health outcomes and more efficient delivery of healthcare. But it will happen more quickly if physicians and content providers are more directly involved in design and implementation of EMR systems, and if content drives the technology.

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