Google, Microsoft and the Online Health Divide

The introduction of Google's PHR (personal health record) effort by Google CEO Eric Schmidt Feb. 28 has some observers saying it could be a complement to Microsoft's own HealthVault initiative.

Google Health and HealthVault are vying to help people manage their PHRs from a single portal. The assumption is that, as they do in everything else, Google and Microsoft will compete to offer PHR systems. However, one consultant who services health care payers and providers said the companies are tackling the challenge in such different ways that they are poised to complement each other.

Andrew Rocklin, principal of Diamond Management & Technology Consultants, told eWEEK that Microsoft wants to be more of a middleman that stores the data, with partners putting front and back ends on it.

For example, Microsoft is partnering with device manufacturers of glucose and blood pressure monitors—vendors who provide back-end information—as much as it is with service providers such as ActiveHealth Management, which offers its own PHR application, to snap on to the front of HealthVault.

Google Health partners include retailers with pharmacies, such Wal-Mart Stores, Walgreen and Duane Reade.

"Essentially, Microsoft wants to become the platform through which these partners connect, and hopefully knit together enough value to attract consumers," Rocklin said. "Google, on the other hand, is going closer to the source with a consumer-facing PHR."

Google and Microsoft are taking complementary approaches that could coexist in the long run, but success will depend on finding the right partners that connect consumers with what they value, said Rocklin, who did not rule out the potential for overlap that would put the two companies in competition.

Because Google Health is not fully formed and could change between now and its release later in 2008, Missy Krasner, product marketing manager for Google Health, declined to compare and differentiate the service from Microsoft's HealthVault.

However, she hinted that one competitive differentiator could be Google's core competency: search capabilities in Google Health.

Krasner also said Google is trying to offer more of a platform than an application, allowing people to build on top of it.