Tim Cook Discusses Wearables, Acquisitions, and Executive Changes at D11 Conference.

5-29-2013 12-31-57 AM

Tim Cook took the stage at AllThingsD’s D11 conference ready to brief reporters on the state of Apple Nation and field questions from event organizers Walt Moosberg and Kara Swisher. Cook interviewed at last year’s AllThingsD conference, discussing efforts to expand Facebook integration in iOS 6 and the recent uptick in product leaks.

The interview kicked off by asking the question that everyone was thinking, as Walt Moosberg posed, “There’s a sense that you may have lost your cool. Is Apple in trouble?”  Cook responded assuredly as any CEO would, highlighting the iPad’s market share along with other substantial figures. He then brushed off the idea entirely by saying that Apple has always had tough competitors, but it has “always suited up and fought.”

The interview covered a lot of ground in a short period of time, but we will break down what’s coming for Apple and what it means to healthcare.

Wearables

“There are lots of gadgets in the space. I would say that the ones that are doing more than one thing, there’s nothing great out there that I’ve seen. Nothing that’s going to convince a kid that’s never worn glasses or a band or a watch or whatever to wear one."

Mobile health is obsessed with Google Glass, with daily speculative pieces on how the new form factor will alter the way doctors document visit notes or how nurses capture vitals or wound assessments. There are scenarios that imagine EMTs live-streaming trauma care for patients en route to the ED. But Glass has limitations, and Cook is clearly unimpressed by either the hype or the new form factor, casually dismissing the growing excitement by saying he “doesn’t know a lot of people who wear glasses who don’t have to.”

Apple, on the other hand, is widely rumored to be finalizing plans to unveil their own wearable: a smart watch. Cook showed off his iOS-synched Nike FuelBand, saying that the company did a great job with its design.

Cook suggests that to see the rapid adoption that Apple targets, a device would need to be multi-functional, unobtrusive, and fashionable. He says the only great wearables are singular in function, like activity trackers.

The Apple Smart Watch could see its unveiling as early as the WWDC conference June 10, but recent rumors place an release date nearer to the end of 2014. When and if if does happen, it will be an immediate disruptor to the entire activity tracker market and to Google Glass, which seems to have overlooked the biometric and quantified self possibilities of a wearable device.

An “Open” Apple

When pressed for a reason that Apple’s ecosystem is closed compared to that of its competitors (read: Android,) Cook had little to say other than to admit that it may have been a misstep, and that the company is evaluating ways to soften its stance on third-party customization.

"On the general topic of opening up APIs, I think you’ll see us open up more in the future, but not to the degree that we put the customer at risk of having a bad experience. So there’s always a fine line to walk there, or maybe not so fine."

Cook went on to confirm that Apple would begin allowing additional features to be coded directly into iOS devices by third-party developers, similar to the work Facebook did in creating its “Home” smart phone overlay.

Depending on the amount of control Apple gives up, this could be a critical step forward for mobile health app developers looking for more compelling ways to engage with patients. Could a phone be programmed to lock until a patient takes their blood sugar reading? The iPhone could become a much more valuable medical device if developers were able to seep out of the app layer and start interacting with the underlying source code.

Acquisitions

Apple is officially shopping for talented startups, according to Cook. He went on to say that Apple has already acquired nine companies this year, but that Apple does not generally report acquisitions unless they are required to do so.

The disclosure came after being questioned about Apple’s significant cash position of more than $100 billion and why the money isn’t being used for acquisitions. Cook said that Apple acquires a company every 70 days, but this year it has been more aggressive. He also said that the company generally targets small, private companies with deals of less than $100 million. However, Cook made a point to clarify that Apple is not opposed to a larger, blockbuster acquisition if the right opportunity presents itself.

As Apple ramps up efforts on its smart watch — which recent reports have suggested will be heavily outfitted with biometric capabilities — the company may be a logical buyer in a health IT market prime with high-value startups that understand the market and the unique customer expectations. As Samsung increases pressure on Apple with its “S Health” app that integrates personal wellness information with activity trackers and wireless scales, Apple could broaden its acquisition strategy to pad against a lack of internal mobile health development initiatives.

If Apple is on a buying spree, it’s a reasonable conclusion that the effects could be felt close to home in health IT startups.

Other Noteworthy News

Cook took the opportunity to announce that former EPA chief Lisa Jackson would be joining the executive team to coordinate Apple’s environmental policy. Jackson will report directly to Cook.

Cook also reported that iOS 7 has been redesigned and will be unveiled, along with the MacBook OS, at Apple’s annual developers conference on June 10.

Conclusion

Apple is a consumer-oriented business that is treading deeper and deeper into the mHealth space as the digitization of healthcare marches onward at a full pace. The company is widely rumored to be developing its first wearable device that will compete directly with established market leaders. At the same time, the device will introduce a new form factor for entrenched mHealth app developers to work with, capable of capturing biometric data that will be leveraged in unimaginable ways to improve home monitoring and transitions of care.

In preparation, Apple is acquiring companies at twice its historic pace. Smart money would favor health IT startups since that’s a  sector in which  Apple has little expertise, but interest and demand.

While Cook’s own future at Apple has been widely questioned, the future of mHealth seems to be moving in a positive trajectory.

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