Intel To Acquire BASIS

Intel is supposedly buying BASIS. For those who don’t know, BASIS is a self-tracker worn on your wrist, which sounds a lot like what larger players offer. According to the BASIS website, it is, "The world’s most advanced health tracker."

BASIS does more than the more common wrist-worn trackers from Fitbit, Jawbone, Nike, and Misfit, which is where the "world’s most advanced" part comes in. In addition to tracking movement, intelligently identifying the type of activity (biking, running, walking), tracking sleep (including stages of sleep), and calculating calories burned, it also has a heart rate monitor built into the watch.

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BASIS uses heart rate to do more than other bands can do in terms of feedback and insights for users. BASIS combines heart rate data with the activities and intensity levels it identifies. That allows it to provide better insights, such as caloric expenditure. I don’t have a BASIS, but I’m sure others can weigh in on what makes it good or bad.

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Back to the Intel deal. The price Intel paid for BASIS is unknown, but the speculation is that the purchase price is between $100 and $150 million. BASIS had raised over $30 million in venture capital and Intel was an investor in the company’s last round, making this acquisition not quite as surprising. Apparently several large players, Google included, were potential acquirers for BASIS. It’s a good outcome for a venture-backed company that’s not quite three years old. It’s a phenomenal outcome in healthcare, but activity tracking isn’t really healthcare, so I don’t think it counts.

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According to TechCrunch, BASIS owns about seven percent of the wearable health tracker market, falling behind bigger players Nike, Jawbone, and Fitbit. I’ve been wearing a Misfit Shine for the past month and like it a lot. I wonder how Misfit and BASIS compare to each other in terms of adoption? Either way, $100-150 million for a small portion of the health tracker market is a pretty good indication that the market is real and has big money coming to it. Exits like this will make the market more attractive to investors as well. The article above projects that 17 million wristbands will be sold in 2014.

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For me, I’m currently wearing a Misfit Shine on one wrist and Pebble on the other. I prefer the Shine to my old Fuelband. I was skeptical of the Pebble, but I’ve grown to like it a lot. Seeing notifications is pretty simple but surprisingly convenient when you have your phone in you pocket or you’re driving.

The most immediate market trend — and what I think what makes BASIS more interesting than the other trackers in its category — is the additional intelligence and insights it can come up with by capturing heart rate. Just as smartphones have gotten more advanced, wearables will become more intelligent in time. They already are getting smarter. This trend will continue be a result of better algorithms, smaller, lower power sensors, and better battery technology.

At one end of the wearables spectrum is the very powerful Samsung Gear devices and the other are the "basic" trackers like the Jawbone and Nike. Google Glass fits somewhere in there, but I’m leaving it out because I still think of it as its own thing. The basic bands are going to continue to get more advanced, and people will expect more and more.

But does all of that recording have to be done by one device like a BASIS? There are lots of companies (vendors, payers, provider systems) flocking to Validic to aggregate patient reported data. By easily aggregating data, it’s possible to accomplish similar results to what BASIS can do with its own data. So will software win out over hardware? I’m betting it will be a combination of both.

At the end of the day, I don’t think most healthcare consumers are interested in more advanced tracking and insights. As we see more systems and payers pilot some of this, healthcare doesn’t really need the advanced features that I’m looking for and that the quantified self market is investing in. But the technology around tracking (both hardware and software) can be repurposed for healthcare or applied in different ways for home and remote monitoring. I’m sure this is of interest to Intel, even if it is a few years away.

Unrelated: it’s a bit annoying to have to capitalize an entire company name. I’d vote all lowercase if I was forced to choose between all lowercase or uppercase. I’ve been noticing a trend with new companies back to capitalized first letter, lower case everything else, like we were all taught in grade school. Companies still seem to combine multiple words without spacing, though.

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Travis Good is an MD/MBA and co-founder of Catalyze. More about me.

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