November 8th, 2007
Internet health finally getting healthy?
Are Internet health sites finally ready to make some serious money, or are they just poised for a shake-out that will leave everyone broke?
After nearly 10 years of hard work WebMD reported yesterday it made $11.5 million in its last fiscal quarter, on sales of $87.2 million.
Some analysts upgraded the stock, along with that of HLTH Corp., which owns a majority of WebMD. Later HLTH said it would merge into WebMD, an expression of confidence in the site.
Having covered WebMD since its founding by Atlantan Jeff Arnold (last seen selling his HowStuffWorks to Discovery Networks) nearly a decade ago, this pleased me. I have never invested a penny in the company, but they used to be the home team. Like Usher and Greg Maddux.
Still, there are a ton of other outfits now angling for a cut of those profits, which look good on paper but could easily dry up in a fight. Revolution Health. Healthline. Not to mention Healthcare.com, whom we profiled the other day.
There’s a lot of consumer demand for credible health information, but extracting that value has always been problematic. We’re talking about hand-built databases here, along with a variety of other associated services. In a heavily-regulated market that looks to become more regulated over time.
So how many health sites do you expect will ever turn a profit, as WebMD finally has?
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Dana Blankenhorn has been a business journalist since 1978, and has covered technology since 1982. He launched the Interactive Age Daily, the first daily coverage of the Internet to launch with a magazine, in September 1994. See his full profile and disclosure of his industry affiliations.
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