Why Big Tech’s move into medicine is a mistake


There have been rumors for years; there have been presentations, speculations, and occasionally even a minor product launch, but now it is finally happening: the technology giants are making their long-awaited push into healthcare.

As so often, Amazon led the way, paying $3.9bn for One Medical in the US, a primary healthcare organization that covers almost 800,000 people across 25 states. For Amazon, it is a huge step up in its attack on the medical market. It bought online pharmacy PillPack for $750m in 2018 and since then has started selling through its own pharmacy as well. But this is the first time it has taken control of a major healthcare provider.

Apple has similar ambitions. Last week, the company set out its strategy for making healthcare its next major expansion, with devices, apps and services based around its existing products. There is speculation that it may make a similar acquisition to Amazon. Google has also targeted the industry, as it has Meta. Healthcare is shaping up to be a major battleground for some of the world’s biggest and richest companies.

Eyes on the prize

It’s not hard to understand the attractions. In most countries, healthcare provision is inefficient and expensive, with outcomes that could be vastly improved. The sector could certainly use new technology and new ideas, in management and delivery as well as drugs and treatments. And it is a huge industry, accounting for 10% of GDP in most countries, and even more in the US. With populations ageing, it is only going to grow. Even a tiny slice of the market will be valuable.

The problem, however, is that this will take the tech giants into dangerous political territory. “The deal will expand Amazon’s ability to collect the most intimate and personal information about individuals, in order to track, target, manipulate and exploit people in ever more intrusive ways,” warns the Open Markets Institute, an organization that campaigns for stricter competition regulation .

There is truth in that. It is one thing to monetize our record of browsing for new phones or holidays and then use that information to feed us advertisements or recommendations for different products. That happens all the time, and we more or less accept it as the price we pay for all the free products we get from the internet. It is a different matter to collect and manipulate our health records – there is a reason why doctor-patient relationships have always involved a degree of confidentiality. The tech giants can promise to respect that, but they have been so cavalier with the use of data in the past, and so reckless about finding ways of making money from it, that no one is likely to believe them.

It’s not like slinging books

The political scrutiny will be intense. Even in a relatively free-market system such as the US, the government is a major player and in just about every other developed country in the world it is the dominant force. It’s one thing to disrupt the market in books, music, clothes or food retailing – they are already very competitive markets – it is something else to open up hospital services, GP surgeries, or even pharmacies to new ideas.

On top of all that, doctors everywhere have formed themselves into the fiercest trade unions ever seen. None of them will give up any of their privileges easily, and they invariably have the public on their side. Governments are not going to sit back and see how the dust settles – they will stop the process before it has even started.

The reality is that, if the tech giants become major players, they will invite intense regulatory scrutiny and provoke a political backlash. Most of the major tech companies are already skating on very thin ice, with lots and lots of governments, regulators and activists demanding that they be broken up, that they pay more taxes, and that their power be curbed. Healthcare could easily be the tipping point: the moment when all that talk finally turns into action. It is not worth it – and if the likes of Apple and Amazon don’t get that they will have big problems in the years ahead.

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