Google is well positioned to enter the personal health record market

Datamonitor believes that Google's entry into PHRs means that PHRs will become a success and result in consumers becoming more knowledgeable about their own health. While other companies have developed PHRs, the significance of Google's entry cannot be underestimated. Primarily this is because of the unparalleled reach that Google has into consumers – especially those under the age of 30.

PHRs, and Google's entry, are a product of consumers becoming more powerful within healthcare – this is a result of the internet and patients entering the physician's surgery more knowledgeable than ever before. The move by Google into the market is particularly significant because it is one of the most powerful and best-known consumer brands in existence today. While Google will not be able to depend purely upon its branding to ensure the success of its PHR product – the history of its other products to date stands Google in good stead, as does its consumer reach through its search engine and e-mail.

However, other companies are developing PHRs. They most significantly include Revolution Health founded by Steve Case the former CEO of AOL – but also IBM through Second Life and Microsoft with Health Vault. Revolution Health is the most significant company outside Google because of its breadth of offering and consumer appeal – however as a start-up it does not have the ready customer base or widely recognized brand that Google has. In addition, Google is in a strong position for success, in comparison with other PHRs, because it is targeting consumers in an advertisement free environment.

Companies will benefit

Overall, these companies are likely to achieve success by being involved in PHRs – and will benefit from any success that Google has within PHRs as the trend seeps through the industry. Of the traditional IT vendors IBM and Microsoft are demonstrating forward thinking by entering into this space – and positioning themselves well for the future.

As the film industry has been slow to deal with the issue of movie distribution on the internet and fought it rather than embraced it – and suffered as a result - likewise, healthcare technology companies should not run scared of PHRs and Google. If vendors try to ignore the progress Google and others are making they may find themselves behind the times and considerably less competitive in a few years time. As such, Datamonitor believes that traditional vendors in the healthcare industry should embrace Google's entry as an opportunity.

Some in the industry may be concerned that Google will move further into the healthcare space. However, Eric Schmidt, Google CEO, stated at HIMSS that Google did not intend to enter further into healthcare beyond PHRs – for example by developing their own electronic healthcare record (EHR). It is unlikely that Google will expand its business further into healthcare, primarily because it would require an adjustment to its pricing model – and move away from being a pure consumer centric product.

Interoperability is crucial

The success of PHRs is going to be dependent on their ability to become interoperable with EHRs – this is important for both PHR and EHR vendors. As consumers increasingly use Google's PHR, and other vendors' PHRs, they will expect their healthcare provider to have interoperability between their PHR and the healthcare provider's EHR. A failure to be interoperable could result in the patient moving to a healthcare provider that is able to provide this service. Thus, both EHR vendors and systems integrators should work towards ensuring interoperability between EHRs and PHRs.

Furthermore, there is opportunity for traditional vendors to offer their own PHR within the space as an alternative to Google. While Google has been a great success, some consumers are suspicious of the company and their use of data. As a result, there will be opportunities within the market for multiple PHRs to exist alongside each other. However, it is Google through its brand strength and consumer reach that is likely to have the most impact upon the industry and bring PHRs into the living room of the population.