Aging Gracefully at Home...Technology Can Help!

by Harry Wang, Research Analyst, Parks Associates

The aging population is now a global concern. Even in developing countries like China and India, dramatic improvements in living standards and advances in medical technology have led to a growing senior population. According to the World Health Organization (WHO), by 2030, more than 973 million people worldwide will be 65 and older, up from 420 million in 2000. The percentage of population 65 years and older will rise from 15.5% to 24.3% in Europe, 12.6% to 20.3% in the U.S., and 6% to 12% in Asia during the same period. An aging population is usually accompanied by rising incidence of chronic diseases and soaring demand for healthcare resources, putting extra pressure on many nations’ already overburdened healthcare systems.

Healthcare reform is underway in many countries in order to cope with these challenges. Most emphasize prevention over intervention as a means to delay the onset of chronic conditions. But an indispensable component of any healthcare reform should include the reconsideration of resource allocation for different types of population subsets. For years, the industry has focused healthcare on institutions: doctor’s offices, hospitals, or outpatient surgical centers. With the coming of preventive care, a new place becomes qualified: a patient’s home. Many studies have shown that home care not only saves money but also gives patients a sense of security and comfort.

Patients’ homes have been quickly modernized these days, thanks to new-generation technologies that provide fast and secure communication and diagnostic tools and reliable access to a wealth of information. Home care is based on the premise that patients can use these tools to access a variety of healthcare resources without leaving the house. With these new technologies, patients can communicate with doctors through e-mail or live video conferencing, and they can self-monitor vital signs and let physicians access these data remotely to make diagnosis and provide treatment advice. For frail seniors, medical and motion sensors can be set up in the home to inform caregivers of daily living and health conditions. This technology-laden home care system, if widely deployed, could relieve the resource crunch on many hospitals and medical centers and allow these institutions to focus instead on patients with acute needs or in severe conditions. Home care will complement institutional care without jeopardizing the quality of care that the patients receive and optimize resource utilization for the entire healthcare system.

This transition will run its course over many years. For one thing, systematic shifts require behavioral changes from all parties involved. In our healthcare system, from doctors to patients, it will take a long time to assimilate new behaviors. Technology can expedite this process but can’t transform it overnight. At the same time, awareness and acceptance are predicated on fast dissemination of scientific evidence of clinical efficacy and financial savings, a task made easy through the Internet.

Parks Associates projects that by 2012 in the U.S., 16 million senior citizens and 17 million baby boomers could benefit from technology-assisted home care services offered through big companies such as Philips and Boston Scientific as well as start-ups like Dovetail Health and VitelCare. Even broadband service providers can leverage their customer reach to offer home health services on top of their existing entertainment and home security service tiers. The market is wide open and calls for innovative solutions and smart marketing to help our aging population live wholesomely at home.

This article was published for the 2008 CONNECTIONS™ Conference Industry Insights, the official publication of CONNECTIONS™.

Opening Comments

Summary information from Day 2: CONNECTIONS™ May 2007, hosted in Santa Clara, CA.

Opening Comments
Presented by: Kurt Scherf, Vice President and Principal Analyst, Parks Associates

Summary of this session:
Kurt Scherf, vice president and principal analyst for Parks Associates, began Day 2 with an overview of Parks Associates’ latest research across a number of digital lifestyles product and service categories. Scherf reminded the audience of a key point made at the CONNECTIONS™ 2006 conference – that industry consolidation in broadband and access spaces was indicative of the importance of facilities-based service providers in deploying many of tomorrow’s consumer technology offerings. Further, this consolidation is evidence that service providers and their equipment vendors are working to establish seamless end-to-end links between their services and their customers in order to provide a rich array of bundled services offerings and to further strengthen the bond between carrier and customer.

He provided examples of the major consolidation in the past year, just in the broadband and access areas. As examples, he noted Motorola’s acquisition of Broadbus, Cisco’s purchase of WebEx and Ashley Laurent, Ericsson buying Tandberg and Redback, the Alcatel-Lucent merger, and NDS acquiring Jungo.

With this major consolidation in place, a key focus for the next year will be the deployment of actual consumer products and services across the digital lifestyles value chain, including such categories as Data & Voice, Multimedia/Entertainment, Home & Lifestyle Management, and Value-added Services.

Already carriers in the broadband and television services areas are expanding their portfolios of offerings. Competition between and among providers is a key driver for companies desiring to strengthen their services. Residential broadband penetration will exceed 50% of U.S. households this year, and broadband and television service providers will focus on three key tenets as they market their services – Cost, Convenience, and Convergence.

A new area for growth will certainly be in the “Web 2.0” or social networking/media spaces, Scherf said. Parks Associates conducted a significant study in 2006 – Digital Media Habits – that explored consumers and their habits as they relate to self-created and social media. There are definite areas of interest and potential, particularly in how younger consumers are expressing themselves through Web sites and via content sharing. However, there are many questions about how (or if at all) social and community networking will be a significant revenue-generating business.

Home networking has reached new heights, Scherf said, and there is a renewed focus on multimedia and entertainment networks, particularly now that Apple has entered the fray with its own media receiver. Also significant is the involvement of the service provider community in pushing not only data and voice networking platforms but also entertainment (multiroom DVR) solutions. 2007 and 2008 will be significant years for the reintroduction of media adapter devices and for a renewed focus on consumer storage that places as much emphasis on content sharing as it does on safe and secure backup and safekeeping of digital media. In total, Parks Associates expects more than 900 million devices to be deployed in home networks by the end of 2011.

Home and lifestyle management trends indicate some interesting growth opportunities. Remote management solutions – including Web cameras and two-way access – will continue to see growth in the next few years, and the service provider community will be key to deploying more of these to consumers. This sector will also benefit from the current popularity of advanced entertainment solutions because both high-end home theater and multiroom audio could provide a good framework for higher growth of home controls. Health management is also an interesting area of growth. Parks Associates is projecting a $2.1 billion market for enhanced remote and home healthcare applications under four main areas – Acute Care Monitoring, Wellness Monitoring, Geriatric Monitoring, and E-health Services.

Finally, Parks Associates is continuing to watch the development of digital home support and service offerings. This sector, with the promise of reducing the complexity of consumer technologies such as home networking, broadband, and digital devices, abounds with opportunities. Parks Associates has outlined nine major areas where different players could enter and succeed in enhanced customer support – everything from enhanced security and automated fixes to professional technical support and the role of “digital home advisor” services.