Integration, Monopoly and what it means for the healthcare technology assessment

Ben Thompson has his adherents, and he swears by Apple; more than the technology stacks, it is essential to put things in perspective whether Apple can be relied on for healthcare. This post is a trigger to what he has espoused. As usual, it has some fictional account of facts, but he’s obviously blind to numerous technology events that occurred in between.

I’d start with the Canadian company-BlackBerry that had pioneered the cloud delivery of content- browser to email. And then made it ultrareliable. It was good for the bottom line because it had a dedicated revenue stream. In the era of 2G and early 3G, BlackBerry stretched the data limits. It was good for the consumers (and the companies) because that explained it’s technology dominance. However, as the companies sunk in millions of dollars in investments, it was apparent that they cannot recover costs if BlackBerry persisted with its thrifty cloud processing. BlackBerry failed to respond effectively to the shifts in time (and perception), and its downfall was apparent.

 

One of the reasons why Apple is profitable is because of round-tripping and complex financial gymnastics to avoid paying taxes in its host country. Although the governments have moved in to criticise and promised to recover the amount due to them, the actual progress on the ground has been slow and tardy. I am not aware of what goes on in the background.

 

If you keep these two broad trends in mind, it would then become apparent that Ben has clearly missed the point. I’ll only post the relevant bits to put up a rebuttal.

 

 

Apple reportedly started iPhone negotiations with Verizon, but it turned out that Verizon was already kicking AT&T’s (then Cingular’s) but through aggressive investment and technology choices, resulting in increasing subscriber numbers largely at AT&T’s expense. Verizon saw no need to change their strategy, which included strong branding and total control over the experience on phones on their network. AT&T, meanwhile, was on the opposite side of the coin: they were losing, and that in turn had a significant effect on their BATNA — they were a lot more willing to compromise when it came to branding and the user experience, and so the iPhone launched on AT&T to Apple’s specifications…Four years after launch the iPhone did finally arrive on Verizon with the same lack of carrier branding and control over the user experience; in other words, Verizon eventually accepted the exact same deal they rejected in 2006 because the loyalty of Apple customers gave them no choice…

I would never know what went through Verizon and I have never looked at the US telecom market carefully (but it doesn’t hold a candle to what’s happening in South Korea/India and other South-East Asian economies). The only reason why it gets the maximum eyeballs is because of high rent extraction by monopolies. (It is the same for Canada). I think Verizon had a superior coverage because of CDMA (rather than inefficient GSM). Because of spectrum issues and poor reception, Apple phones routinely dropped connections. Likewise, the famously infamous Antenna-gate where Apple screwed up an entire generation of the phones because they didn’t know how to place an antenna in the phone!

What makes this model so effective — and so profitable — is that Apple has differentiated its otherwise commoditizable hardware with software. Software is a completely new type of good in that it is both infinitely differentiable yet infinitely copyable; this means that any piece of software is both completely unique yet has unlimited supply, leading to a theoretical price of $0. However, by combining the differentiable qualities of software with hardware that requires real assets and commodities to manufacture, Apple is able to charge an incredible premium for its products.

Ben’s indeed excited about Apple raking in immense profits- but I disagree entirely with iOS being a “superior” software solution. One thing that Apple has nailed is the user interface by making technology accessible to a vast majority of people. However, it’s simplicity is the Achille’s heel because it severely limits what you can actually do with the hardware.

It means that Apple can run proprietary tests to show its hardware is superior to anything else on the market. It can claim that the newer generation processors run “23% faster” than the previous generation. Unknown to a lot of users, the processors are commodity ARM chips that run iOS’s instruction set differently from how others to achieve the same output. Yet, it would be a foolhardy initiative to compare apples with oranges (pun not intended!)

 

However, there’s another interesting bit on near-field communication (NFC) that is relevant for the healthcare facilities. Android phones had it in 2010 and BlackBerry had followed suit. You could write the NFC tags using your phone to automate it. Let’s say that the user is in a sterile area and by use of the NFC, you could set up automated reminders. Or you could have NFC tags to turn the phone switch to silent mode. There were many automated workflows but then collectively, the industry never really took off. Almost all the modern devices carry the NFC chip (most of the androids), but Apple restricted the feature. Here’s a blurb from Ben (emphasis mine):

To back up, NFC stands for “Near-Field Communication”, which is a protocol for two electronic devices to communicate when they are within 1.5 inches (4 centimeters) of each other. There are three use cases for NFC chips on smartphones:

  • Smart card emulation, where NFC devices act like payment cards; Apple Pay is an example of this, as are a host of other use cases, like transit tickets or smart keys.
  • Reader/Writer, where one active NFC devices reads or writes to a passive NFC device, such as an NFC sticker that receives power from the magnetic field generated by the active device.
  • Peer-to-peer, where two NFC devices exchanges information on an ad-hoc basis.

In short, NFC makes it possible for two devices to communicate without any prior setup, making possible a range of use cases far greater than, say, Bluetooth…and yet the only NFC technology most of you have probably used is for payments. Why?

I think that Apple deserves a lot of the blame. While Android devices have had NFC chips since 2010, Apple only added them to iPhones with 2014’s iPhone, and it was limited to Apple Pay. Two years later Apple made it possible to read some NFC tags and use Apple Pay, and only two months ago made it possible to write NFC tags. No other payment solution can use Apple Pay, only five transit systems can use Apple Pay with an “Express Transit” mode, and only 11 more with time-of-purchase authentication.

Ben assumem that Apple moves the “technology needle”, but it is far away from the truth. It is apparent that Apple stunts their devices. For example, they relied on their own modems from 2014 to 2018/9, and as such, all the models have abysmal reception (not to mention the battery drain). It is with the current model (I think 11) that they went scurrying to Qualcomm for the underlying technology. BlackBerry, meanwhile, had Paratek antenna that actually adapted to the signal strength in real-time. I have always had a superior call quality experience using that device.

Ben gets the following right though (!):

Apple removed all vaping-related apps from its App Store on Friday, siding with experts who call vaping “a public health crisis” and “a youth epidemic.” Some of the 181 vaping apps removed by Apple permit the user to control the temperature or other settings on vaping devices. Others offer users access to social networks or games. The App Store has never permitted the sale of vaping cartridges through apps.

“We’re constantly evaluating apps, and consulting the latest evidence to determine risks to users’ health and well-being,” Apple spokesman Fred Sainz said in a statement. Apple cited evidence from the Centers for Disease Control and Prevention and other groups that have linked vaping and e-cigarette usage to deaths and lung injuries.

It’s certainly tempting to cheer a decision like this, particularly given the health crisis that emerged around vaping this year, and the more widespread concerns about vaping being an on-ramp to tobacco use. Then again, given that the crisis seems centered on counterfeit cartridges, being able to connect to your smartphone could be a real benefit. Note this paragraph written by a medical marijuana user:

But there are also more sophisticated devices that have USB and even Bluetooth interfaces to enable the patient to control heat settings, display lights, and update the firmware. The Bluetooth devices are accompanied by apps on the iOS and Android mobile platforms which can allow the patient to measure and monitor their usage, and, as is the case with PAX to identify the medication loaded into the device, and to understand its contents, such as the overall cannabinoid profile, the terpene mix, and other components. It also allows a user to validate the authenticity of the medication as well as testing and batch results.

Apple removes the vaping apps, but in effect, it also sounded a death knell for those who use it legitimately. For them, it is a defining PR moment because it would only burnish their “family-friendly credentials”. I have no clue if the same vaping apps are removed for other geographies.

 

For the same reason, my only criteria to recommend a product (or for personal use) is data portability. For one simple reason- it is something that you take out time and effort to create, and you should retain full control over the process. I can’t use one unless I know the exit path clearly. (For the same reason, I prefer to use and endorse WordPress because it is super easy to port out your data and roll your own hosting solution). Or for that matter, any other application; say PDF annotation etc.

 

Apple (or any other technology company) looks at healthcare from a singular perspective of data collection. I am incredibly wary of becoming yet another “data-stamp” that generates data (and in effect, not being compensated either). There have been calls to create “public data banks”, but those are fallacious ideas that have little practical relevance.