The digital health market has become phenomenally competitive over the last few years, with giants like Google and Apple duking it out with smaller, fast-moving startups over the choicest opportunities in the sector.
Even with a behemoth like Google, you expect to see some stumbles, and the Internet giant has taken a few. But seldom have we seen a billion-dollar company walk away from the digital health market, which arguably stands to grow far more. Still, according to a recent news report, that’s just what Nokia may be doing.
A story published in The Verge reports that the Finnish telecom giant has launched a strategic review of its health division. While Nokia apparently isn’t spilling the beans on its plans, the news site got a look at an internal company memo which suggests that its digital health business is indeed in trouble.
In the memo, The Verge says, Nokia chief strategy officer Kathrin Buvac wrote that “our digital health business has struggled to scale and meet its growth expectations… [And] currently, we don’t see a path for [the digital health business] to become a meaningful part of a company as large as Nokia.”
While it’s hard to tell much from a press release, it notes that Nokia’s digital health division makes and sells an ecosystem of hybrid smart watches, scales and digital health devices to consumers and enterprises. Its digital health history includes the acquisition of Withings, a French startup with a sexy line up of connected health-focused digital health devices.
This may be in part because it just hasn’t been aggressive enough or offered anything unique. In the wake of the Withings acquisition, Nokia doesn’t seem to have done much to build on Withings’ product line. Though much of the success in this market depends on execution, its current roster of products doesn’t sound like anything too exciting or differentiated.
It’s interesting to note that Buvac blames at least part of the failure of its digital health excursion on Nokia’s size. That doesn’t seem to be a problem for industry-leading companies like Apple, which seems to be carving out its digital health footprint one launch at a time and cultivating health leaders along the way. For example, Apple recently partnered with Stanford Medicine launch an app using its smartwatch to collect data on irregular heart rhythms. Arguably, this is the way to win markets and influence people — slow and steady.
In the end, though, Buvac is probably right about is digital health prospects. Nokia’s seeming failure may indeed be attributed to its sprawling portfolio, and probably an inflexible internal culture as well. The moral of the story may be that winning at the digital health game has far more to do with understanding the market than it does with having very deep pockets.