April 19, 2007 1:24 PM PDT

AOL founder launches health care Web site

AOL founder Steve Case unveiled RevolutionHealth.com on Thursday, in a move that may ultimately challenge industry stalwart WebMD.com for a slice of the multibillion-dollar pharmaceutical advertising market.

RevolutionHealth.com, operated through Case's Revolution Health Group, enters a market that is dominated by WebMD.com, and other players, such as Yahoo Health and the Mayo Clinic's Web site MayoClinic.com.

As previously reported in The New York Times, the free site includes information on health issues, conditions and diseases. It also has a personal-page builder, as well as tools that enable users to assess the risk of suffering from particular diseases and how to address them; post a rating for a particular doctor, hospital or health care service; and check symptoms for potential causes.

Steve Case
Steve Case

Revolution Health Group also announced Thursday it has acquired CarePages, a free service that allows users to create personal, private Web pages that can be used for family members and friends to communicate with each other and monitor the health of another.

Revolution's CarePages, personal-page builder and social-networking features are some of the technologies and content that will separate it from its competitors, Case said during an online press conference. He added, however, he does not expect the site's subscriber level to swell into the millions overnight.

"It'll take some time to get going," Case said. "When I was at AOL and we launched instant messaging in the fall of 1985, it took awhile to take off and now people can't live without it...The same can be applied to health care."

He added the site is designed to provide users with tools to put them at the center of managing their health care--a trend that analysts say is under way online.

"The trend is toward more consumer-directed health care and allowing people to become more responsible for making choices," said Brian Pitz, an analyst at Banc of America Securities.

This fact has not been lost on pharmaceutical companies, Pitz noted. They are eager to find sites that are robust with trusted content where they can place their advertisements, he added.

In 2005, the top 13 pharmaceutical companies spent nearly $14 billion in marketing prescription and over-the-counter medicines, according to TNS Media Intelligence and Advertising Age. Pitz estimated that less than 5 percent of the pharmaceutical industry's marketing dollars are spent on online advertising--a figure that's expected to grow as more robust health care sites with authoritative content come online.

WebMD, for example, posted revenue of nearly $254 million for 2006, up 50 percent over the previous year.

For now, Pitz said WebMD has a larger and deeper offering than RevolutionHealth.com because it also offers private health care portals to corporations, which account for approximately 21 percent of its net revenue.

"WebMD has a robust business with its private portals that competitors will find it hard to get into effectively," Pitz said.

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This is not news
This site launched in January. I don't understand why the article was written like it just launched today.
Posted by LonghornBlogs (8 comments )
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