Revolution Health’s Lack of Health: Moving Away From B2B Focus; Consumer Only; Strategic Options?
Revolution Health, the high profile health information company founded by Steve Case, has been through its share of troubles over the last year or so: first it laid off about 60 employees from its Health Networks division eight months ago, and last month it laid off another 50 employees, about 20 percent of its present workforce, reports industry newsletter AISHealth. The company says the latest round of reductions was due to a reorgfollowing its December acquisition of HealthTalk, an online source of chronic-care information and programming, the story says. The company now has about 200 employees.
A not-so-secret-secret: Revolution is exiting out of its B2B services (direct-to-employer Web portal business ), and will only focus on consumer health portal/info, and the company confirmed it…it will continue to sell its portal capabilities through licensing partnerships with distributors such as Medco Health Solutions, the company says.
With this reorg, all of Revolution’s acquired businesses will have a single sales force, one content group and one marketing team. The key point is that the company is “yet to show a really cohesive and compelling business strategy,” the story mentions.
We have also been hearing some rumblings of the company looking for strategic options…among some of the options we have heard being discussed is outsourcing some or all of the online ad sales to a network like Glam Media or others. Glam has entered into health network sales recently, and has interests in looking at anchor tenants to own in the sector. More when we have more…
Meanwhile, Steve Case spoke at our EconHealth conference earlier this year in March, and the video is embedded below. Click on the “Browse Video List” button to view the two videos in this series.
Not surprised at all that a Steve Case-led business is having problems. He wreaked havoc on Time Warner when he took over, and the insight we Time Warner employees got into the "entrepeneurial" AOL led to jokes like "entry level hires at <insert Time Warner unit> have more P&L;authority than VPs at AOL" and "only 4 people at AOL have decision making authority and no one knows who they are." The matrixed, overly centralized and every changing structure at AOL that was unfriendly to clients seemed to stem from Case. This is the man who took many months of from his multi million dollar job at AOL-Time Warner to care for his sick brother, something no lower paid employee woudl have been allowed to do. He then had a company wide email sent out grieving his brother's death. Condolences are good form for colleague's losses, but a company wide email for him alone? Gerald Levine didn't do that when his son was brutally murdered. And it looks like Case still hasn't learned that it's about business not ego.
The problem is that it is tough to make money in health website when all the pharma are still only spending 7% of their advertising money online. You will have to survive for a while in order to make money when the pharma start spending their ad money online