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The dot-commies: Shakeout at the Website corral

By:Kenner, Ronald E
Publication: Health Management Technology
Date: Saturday, January 1 2000

With the new technology comes new terminology. It is almost as much a challenge keeping up on the jargon as it is on the "jazz" of the health resources sites as they proliferate seemingly daily and weekly.

Terms like patient information and even patient empowerment have given way to care spaces that, says one expert, can now be sub-categorized as care management and care tools.

"Care space represents the fourth healthcare segment after the content, commerce, and connectivity segments," says Dr. Stan Bernard, an e-Health expert and consultant, who is also quoted in our inside story on these sites.

Care space is divided into two sub-categories, he says: care management, sites which provide comprehensive care services to patients; and care tools, sites that offer interventions such as diseasespecific monitors or home care testing.

And what is likely to become of these multiplying start-ups? "There will be a shakeout on the content sites where we will see a relatively small number of big winners early on, and more money shifting into the care space segment," says Dr. Bernard, "especially those companies that are going to be using the Web to help manage and deliver care."

He speaks from good perspective as a teacher of e-Health at the Wharton School of Business, and columnist of the "Health e-Trends" column for the monthly Internet Healthcare Strategies.

Oddly enough, he says that a tremendous amount of money is chasing healthcare content sites that represent only $7 billion of total market opportunity, while in contrast only a handful of care sites are pursuing the care space-which includes care services-that represents a $700 billion market opportunity.

"We'll see a consolidation within and convergence across e-Health segments-an increasing consolidation of companies within segments, as seen by the merger of MediConsult and Physi-_ cians' Online, two physician portals, and convergence across spaces when a connectivity company like Healtheon acquires a content player like WebMD," he observes.

So there comes a time when there will be an "e-Health shakeout," Dr. Bernard says, "resulting in two to four major players in each space or subspace." He says that other industries have experienced the same thing-where the consolidation results in two major players, and perhaps one or two secondary players. The small or medium size sites are subsumed, acquired, or go out of business.

Certainly many of these sites will go that way. It seems too many of them have a "me-too" form of business plan, each wanting to get a part of the market and hoping they can hang on long enough, or be unique enough, to survive or be bought-out.

It is just possible that some of these sites may one day be consulting their own care tools to find out how they can resuscitate themselves when the market gets crowded, the capital is in short supply, and patients are turning to that next new fascination for cling cAl services.