CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 84% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Amazon Care to close, but ambitions in the $4trn US healthcare sector remain

By Jenal Mehta

14:01, 26 August 2022

amazon app on phone
Amazon Care to close - Photo: Getty Images

Amazon (AMZN) has announced it will cease its Amazon Care project, a plan to provide a health platform to patients. This is however only a small step back on the larger ambition of the tech sector disrupting the healthcare industry.

Neil Lindsay, head of Amazon’s health services, sent a memo to staff that the project was “not the right long term solution” for the clients it aimed to serve. Amazon Care platform aimed to provide on demand medical services including a doctor or any other medical practitioner.

Amazon’s interest in the healthcare industry has been long running and is only expected to intensify with the new leadership of CEO Andy Jassy despite this step back with Amazon Care.

Amazon (AMZN) Price Chart 

Amazon (AMZN) recently finalised its biggest deal in healthcare, acquiring One Medical for $3.9bn, an established telehealth service company which may help fill the shortcomings of Amazon Care.

One Medical is a “human-centred and technology-powered primary care organisation with seamless digital health and inviting in-office care, convenient to where people work, shop, live, and click” as stated in the announcement.

The healthcare industry has huge potential for growth and diversification for technology companies, and Amazon (AMZN) is not the only tech giant aggressively moving to gain ground in the sector. Facebook (META), Alphabet (GOOGL), Microsoft (MSFT) and Apple (AAPL) have all invested in healthcare projects in recent years.

What is your sentiment on AMZN?

122.63
Bullish
or
Bearish
Vote to see Traders sentiment!

Amazon Care

Amazon Care was aimed at being a platform where doctors and medical personnel were available on demand in virtual settings and in person. The service was rolled out in more than 20 cities in the US.

However the service appears to have fallen short in some aspects and Amazon may need to re-set its plans. Lindsay said in a memo sent out to employees that “[Amazon Care] is not a complete enough offering tor the large enterprise customers we have been targeting”.

 

AMZN

122.63 Price
+1.850% 1D Chg, %
Long position overnight fee -0.0255%
Short position overnight fee 0.0032%
Overnight fee time 21:00 (UTC)
Spread 0.13

NVDA

397.42 Price
+4.160% 1D Chg, %
Long position overnight fee -0.0255%
Short position overnight fee 0.0032%
Overnight fee time 21:00 (UTC)
Spread 0.16

META

271.74 Price
+2.790% 1D Chg, %
Long position overnight fee -0.0255%
Short position overnight fee 0.0032%
Overnight fee time 21:00 (UTC)
Spread 0.10

AMD

120.07 Price
+1.660% 1D Chg, %
Long position overnight fee -0.0255%
Short position overnight fee 0.0032%
Overnight fee time 21:00 (UTC)
Spread 0.06

Amazon’s interest in healthcare

The setback with Amazon Care is unlikely to deter plans to expand into the healthcare industry. When CEO Andy Jassy came into his position in mid 2021, he made bold remarks on how he plans to take Amazon forward in the healthcare space.

In an audio recording of a meeting with employees, Jassy was heard saying that  standard healthcare “will not be the way things are done going forward” and that the steps they are taking with Amazon Care and telehealth “fundamentally alters that game”.

These comments provide a glimpse into the ambitious plans the company has in the healthcare industry.

After the acquisition of One Medical, Lindsay echoed Jassy's comments, stating that “we think healthcare is high on the list of experiences that need renovation”.

Amazon has the potential of developing an online marketplace for healthcare services, the same way it builds a platform for retail goods. This can allow for customer reviews, transparent pricing, and informed shopping for customers.

Analysts Sam Glick and John Rudoy of Oliver Wyman comment in a report: “What Amazon offers the healthcare industry is a fast-track to a 21st century business model – one that consumers will find familiar and comfortable. While most of the industry would probably dread its arrival, Amazon may in fact be just what the doctor should be ordering.”

Apple (AAPL) Price Chart 

Amazon is not alone

There are a number of moves being made by the tech giants in the healthcare sector. Here are some examples:

  • Microsoft (MSFT): is involved in AI for healthcare. It acquired Nuance for $19.7bn and has launched Microsoft Cloud for Healthcare.
  • Alphabet (GOOGL): is developing AI tools to diagnose medical conditions. The company launched an electronic health record search to share with health service providers.
  • Apple (AAPL) and Facebook (META): both are involved in capturing health metrics and search tools to support medical advances.

Markets in this article

GOOGL
Alphabet Inc - Class A
123.71 USD
0.16 +0.130%
AMZN
Amazon
122.63 USD
2.22 +1.850%
AAPL
Apple
179.65 USD
1.94 +1.090%
META
Meta Platforms Inc.
271.74 USD
7.37 +2.790%
MSFT
Microsoft
332.33 USD
3.13 +0.950%

Rate this article

Related reading

Capital Com is an execution-only service provider. The material provided on this website is for information purposes only and should not be understood as an investment advice. Any opinion that may be provided on this page does not constitute a recommendation by Capital Com or its agents. We do not make any representations or warranty on the accuracy or completeness of the information that is provided on this page. If you rely on the information on this page then you do so entirely on your own risk.

Still looking for a broker you can trust?

Join the 535.000+ traders worldwide that chose to trade with Capital.com

1. Create & verify your account 2. Make your first deposit 3. You’re all set. Start trading