Big Tech wants to keep you healthy and make loads of money along the way. Apple (AAPL), Amazon (AMZN), Alphabet (GOOGL) and Microsoft (MSFT) — which already have their hands in many facets of our lives, have been ramping their health-care businesses. They’re all vying for a slice of the more than $4 trillion that Americans spend each year on their health — a number that, according to government estimates , will grow to $6.2 trillion by 2028. While monetizing valuable health data is at the heart of what all the tech firms are doing, Apple and Alphabet are in a battle for your wrist, with connected watches and trackers and their ecosystems around them. On Wednesday, at its product launch event, Apple introduced new watches with added sensors to track more aspects of women’s health. Alphabet already has Fitbit and next month it’s set to unveil its first Google-made smartwatch. At Amazon and Microsoft — and to some extent Alphabet — their health endeavors leverage their massive clouds. Amazon is also using its e-commerce logistics to deliver prescriptions to people’s homes. A key acquisition at Microsoft this year puts that tech giant in the business of software-based transcription, which has broad applications in the medical field. Here’s an in-depth look at and our ranking of what each company is doing in health. We’re owners of all four stocks in Jim Cramer’s Charitable Trust, whose holdings serve at the Club’s portfolio. 1. Apple Apple’s vision for health care is to create technologies that arm individuals, medical professionals, and institutions with critical data — monitoring and diagnostics to catch irregularities before they become bigger issues. According to Apple , users can store over 150 different types of health data from the Apple Watch, iPhone and connected third party apps in one central view on the Health app. The Apple watch can read your heart rate, mobility, check blood oxygen levels and detect falls, to name a few features. All this data can be gleaned directly from your wrist. This information is sharable too: Users can transfer their health data between family members, health-care companies and providers. During Wednesday’s launch event, Apple introduced its new watch called the Series 8, which includes a new measurement: a more effective temperature sensor to help track women’s health, including when ovulation has occurred. This new feature can help users estimate ovulation dates and spot deviations from their cycles. The Club’s take: We see Apple as the leading Big Tech competitor in health care because of its first mover advantage with its Apple Watch and its ecosystem of products that provide intuitive connectivity. Over time, we think by increasing the health aspects of the Watch, Apple can attract the aging demographic in the U.S. While this demographic may not opt in for an iPhone upgrade, they could upgrade for a new health tracking feature. Overall, the constant monitoring could arguably lead to in-depth medical records that could allow Apple to make further headway into the $7.5 trillion health sector. 2. Amazon Amazon is making inroads in health care by creating efficiencies and making services more accessible to consumers, leveraging its online retail logistics and its cloud. Back in 2018, Amazon bought PillPack , a full-service online pharmacy that delivers prescriptions directly to your door, for $753 million. Through its PharmacyOS, PillPack manages customers’ medications from refills to renewals to shipping. The online dashboard tracks it all and helps people with their insurance copays. On a similar note, Amazon is considering partnering with pharmacies in Japan where patients can access online instructions on how to take medications and get them delivered, according to a report by Nikkei . More recently, in July, Amazon agreed to buy primary care company One Medical for $3.9 billion; if approved, it will be company’s biggest health-care acquisition to date. One Medical offers its members services from anytime online booking for virtual or in-person doctor visits to messaging providers right in its app. The Amazon deal is pending approval by One Medical shareholders, and it’s currently under investigation by the Federal Trade Commission. The Club’s take : Amazon’s PillPack acquisition and the planned One Medical purchase are opportunities to innovate and improve the customer experience in the vast health-care field. Amazon prides itself on logistics and fast delivery through its Prime service, which is why we see prescription drug deliveries as a potential service that Amazon can lead. Amazon’s partnership with tech-powered One Medical, when completed, would help reimagine the health-care experience as virtual care is making it more convenient for patients to access services. 3. Alphabet Alphabet can make a difference in health care through its variety of tools and offerings, including its cloud solutions and its Google search engine. The Google Health arm, while not a formal business unit, aims to transform the future of health by collaborating with medical professionals and organizations. As health-care companies accelerate digitization, Alphabet’s services will likely become more prevalent to ensure operational efficiency while keeping patient data secure. Its Verily Life Sciences business seeks to change how health care is delivered by gathering data from a variety of sources to produce personalized health care unique to each individual. Alphabet also has smartwatches and trackers. It bought Fitbit in 2021. While Fitbit devices’ bells and whistles are not as extensive as those of the Apple Watch, the products are less pricey. Alphabet is coming out with the Google Pixel Watch next month, its first-even watch made by Google. There’s no pricing yet. But the company has said the device will leverage Fitbit health and fitness tracking technology. The Club’s take : We are on the lookout to see if Alphabet will follow in Apple’s footsteps in consumer wearable devices with its Fitbit and Pixel Watch. But the big opportunity for Alphabet in health care is through its cloud offerings and its ability to gather and sort massive amounts of data. 4. Microsoft Similar to Alphabet, Microsoft’s cloud services will put the company on the map as a dominant tech player in health as data integration and management become necessities in the health-care industry. Microsoft earlier this year completed its acquisition of Nuance Communications, a leader in transcribing the spoke word using artificial intelligence software. Nuance can capture every word spoken by a patient, allowing clinicians to spend less time taking notes and putting them in files. That patient data in aggregate can be reviewed by AI and used to help in early the detection of diseases. By now, you have probably gathered that transformation in health care relies on further adoption of the cloud. This is why a potential key driver for Microsoft’s role in health care will be its cloud integration in the industry as virtual care services expand. The Club’s take : With digitization becoming more prevalent in all industries, including health care, we see Microsoft’s acquisition of Nuance as a step toward transforming health care services. This partnership can also complement Microsoft’s cloud adoption in the sector. (Jim Cramer’s Charitable Trust is long AAPL, AMZN, GOOGL, MSFT. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
Source: Business - cnbc.com
