Can Childrens Hospital Los Angeles find the cure for the ailing Internet medical sector?
With the creation of a for-profit consumer and allied health site called JuniorMed.com, the renowned hospital has taken a step beyond the standard medical Web site into the crowded space in which drkoop.com and others have struggled, if not failed.
The site, which launched in November, offers information on injury prevention, childhood diseases and other topics for parents with children ranging in age from newborns to teenagers. The hospital, which has a 50 percent stake in the new venture, hopes that by trading on its reputation, the site will become a leading source of pediatric health care information.
A great reputation, however, is no guarantee of commercial success. Other medical institutions with even higher profiles, including the Mayo Clinic in Rochester, Minn., are struggling in their efforts to become medical portals, so Childrens has opted for a slightly different tack.
While JuniorMed.com does accept advertising, the hospital has an agreement with Healthology Inc., a 3-year-old New York-based online health media company, to resell JuniorMed.com content to other sites as a way of generating revenue.
“It can be resold to other health care providers on the Web and branded with our logo,” said Margaret Richardson, the hospital’s director of corporate relations. “Most of the medical sites out there don’t employ their own doctors. We have our own staff providing the content.”
The hospital will receive license fees for its repurposed content, 10 percent of the advertising revenue generated by the site and an additional royalty based on the number of hits the site receives. It expects to earn about $100,000 annually.
Content pipeline
Healthology also has a staff of doctors for its own health care site Healthology.com and it maintains agreements with about three dozen other sites to provide content, including drkoop.com, MyFamily.com and EarthLink.com, said company co-founder Dr. Steven Haimowitz.
“The business model for JuniorMed.com is not that we are simply going to create a portal. JuniorMed will certainly be a great showcase for the content, but it will be distributed across the Web to sites interested in pediatric and adolescent content,” he said.
Rachel Terrace, an analyst with Jupiter Research, an Internet research and consulting firm, said that licensing agreements are probably the best hope for JuniorMed.com to generate money for the hospital.
“It’s true that parents are looking for good information for their children, but a lot of other companies have said similar things and have not had success,” she said. “JuniorMed is something they made up out of thin air. It’s not going to be an intuitive site for parents.”
She noted that a site launched by the Mayo Clinic has stalled in attracting traffic, and launching a successful new medical portal can require tens of millions dollars in advertising.
Indeed, the Childrens Hospital site has already found that attracting advertising dollars is no simple task. It was a risk the hospital was well aware of, Richardson said, and so JuniorMed was structured to minimize risk.
Though the hospital will be providing content, it will be done at minimal cost since it is being generated by doctors on staff, while Healthology is responsible for building and maintaining the site. Thus, the project has so far cost the hospital just $10,000, while Healthology has shouldered a far greater share of the development costs, she said.
And while the hospital hopes to make a direct profit from the site, it hasn’t lost sight of the fact that its core business is not online. A successful site will only serve, she said, to raise the hospital’s profile nationally and to attract more patients and donors.
