Bosch’s Telemedicine Shutdown Suggests New Models Are Needed

While many new telehealth plays are rapidly gaining ground, the previous generation may be outliving its usefulness. That may be the message one can take from one giant German conglomerate’s decision to shut down its U.S. telemedicine division.

Robert Bosch GmbH recently announced that it would shut down its U.S. telehealth unit, Robert Bosch Healthcare Systems, which makes business-to-business telemedicine systems. Its offerings include patient interfaces, software and platforms.

You may never have heard of this healthcare company, nor of its massive corporate parent Robert Bosch GmbH, but it’s part of a very large conglomerate with virtually infinite resources.

As it turns out, Bosch is a massive firm which competes with market leaders like GE and Siemens. Robert Bosch GmbH, which has existed since 1886, has more than 350 subsidiaries across about 60 countries and employs about 306,000 people. (I could share more, but I’m sure you get the idea.)

While the failure of one company’s telemedicine strategy doesn’t necessarily mean death for all similar plays, it does suggest that the nimble smaller firms may have more of an advantage than it appears.

Bosch Healthcare was actually way ahead of the market with its offerings, which included remote monitoring tools such as a touch-screen device for home use after hospital discharge and a family of mHealth tools aimed at chronic care management.But they appear to have been held back by proprietary technologies in a market that demands cheap and easy.

Ultimately, the end came when the parent company wasn’t happy with how the telehealth division was performing financially, and decided to cut and run. A statement from the company said that Bosch plans to shift its medical focus to sensor technologies to support improved diagnostics.

It’s hardly surprising that a company Bosch’s size would fail to keep up with the marketplace, given its size. No matter how smart the division’s 125 employees were, they were probably saddled with big company politics which prevented them from making big changes. Not to mention low priced tablets appeared and created a low cost competitor.

The question is, will other large players follow Bosch’s lead? It will be worth noting whether other large companies cede the telehealth market to small and emerging entrants as well. It’s not a no-brainer that this will happen; after all, there’s billions to be made here. But they may actually be wise enough to know when they’re ill-equipped to proceed.

I’ll be particularly interested to see what strategies existing health IT players adopt toward telehealth. It’s unclear how they’ll react to rising consumer and professional interest in telehealth technology, but whatever they do it will probably be worth analyzing.

That being said, with smaller companies out there breaking new ground with next-gen telemedicine apps and tools, they’re probably going to be in the unusual position of playing catch up. And in this case, slow and steady may not win the race.

About the author

Anne Zieger

Anne Zieger

Anne Zieger is a healthcare journalist who has written about the industry for 30 years. Her work has appeared in all of the leading healthcare industry publications, and she's served as editor in chief of several healthcare B2B sites.

   

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