The presence of McDonald’s and Cadbury, among others, as sponsors at the forthcoming London 2012 Olympics has attracted some controversy. Obesity is now, after all, a global concern. The figures are bad and bear some repeating. If current trends continue then up to 48 percent of men and 43 percent of women in the UK could be obese by 2030. Of course this also represents a market opportunity for someone. The profit motive can encourage companies to fight the obesity epidemic (just as it motivated them to contribute to its spread).

Companies such as drug manufacturers are obviously able to provide a direct, medical response which can benefit their bottom line, according to the Financial Times. Less directly (and arguably as effectively) are manufacturers of sports goods.  But not every drug will prove effective or new trainer become fashionable.  So what other industry sectors will this major social as well as medical change impact? So far mobile operators have been largely absent when analysts study such market opportunities (no mention in the FT article).  This probably won’t be the case for much longer. The UK government had made clear it is a believer in the concept of remotely monitoring patients in their own homes, which it argues offers significant cost savings and health benefits. It says three million people in the UK could benefit in this way. That’s an impressive figure.

Telefonica Digital has been looking at what kind of revenues could be generated by remotely monitoring patients via its mobile network. The operator reckons that it could charge EUR100-200 for monitoring a patient with the most serious chronic conditions.  About 1-2 percent of the UK population fall into this category. A charge of EUR 30-50 per month could apply to those requiring less intense monitoring. Five percent of the population fall into this mid-impact category. Finally there is the mass-market category who would pay less than EUR1 per month and could cover 25 percent of the population, for instance subscribers with high blood pressure they need to keep an eye on but who are not facing a critical condition.

The range of pricing options has a classical look to them: At the extremes the small, high-paying demographic versus the big numbers of the mass market that individually generate relatively little revenue.  One figure worth remembering is that the 1-2 percent of the entire population most at risk represent 30-50 percent of the total cost of caring for chronic conditions. That presumably is where the big savings are for public health systems (and are most attractive to politicians).

Bear in mind these numbers are largely theoretical at present. At most O2 probably has a few hundred users currently hooked up to remote monitoring in the UK. And healthcare could look a lot different in five or ten years’ time.  Taxes on sugary drinks could be commonplace or Mayor Bloomberg of New York might be ahead of the game politically with his proposal for a complete ban on the supersized version of such drinks in restaurants, cinemas and sports stadiums. Such a level of regulation could mean society turning to operators and their remote monitoring services. Alternatively, extreme measures could precipitate a rapid decline in obesity, so undermining the need for operators' services.   

And there are obstacles for mobile operators such as questions over legal liability in delivering a health-related service as well as convincing the medical profession there is value from embracing a system that threatens a serious disruption to current work practices and potentially a significant increase in the amount of data they have to handle and analyse.

The bigger question for mobile operators then becomes whether e-health, along with services such as mobile advertising, mcommerce and M2M, can move from the periphery to become mainstays of their business.

Mobile operators must also decide where they want to sit in the value chain. This can be either as a simple connectivity supplier or a provider of a service directly to patients, possibly in partnership with healthcare providers.  One is a steady approach to the market with the prospect of reasonable returns while the second promises higher margins but carries greater risk of a business that fails to deliver on its promise. Either way they are unlikely to end up with the opprobrium being heaped on fast-food chains and confectionary firms in the current crisis.

Richard Handford

The editorial views expressed in this article are solely those of the author(s) and will not necessarily reflect the views of the GSMA, its Members or Associate Members.