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What are the Business Models for In-Building Coverage for Healthcare & Why Look at Them Now?

By Mike Collado
February 1st, 2012

As a prelude to the HIMSS12 Annual Conference, we are sharing a series of posts that focus on using Distributed Antenna Systems (DAS) to provide indoor wireless coverage at hospitals. We’ll explore the trends that are driving the need for in-building wireless coverage, the problems inherent to ensuring pervasive coverage within buildings, the single-carrier model versus the multi-carrier model, and the business and technology considerations that healthcare decision-makers should examine. We’ll also look at how current wireless technologies impact DAS and explore how we believe DAS will evolve in the near future.

Today’s post will focus on some of the basic business requirements and business models that should be looked at when providing in-building coverage. It will also provide some basic questions to look at when evaluating the technology solutions from a capital and operational expenditure viewpoint.

Current Communications Paradigm for Healthcare Systems

Providing the ability for smartphones and tablets to work in the healthcare environment is no longer a nice to have…but a must have. Healthcare applications are driving this requirement as well as the end customer experience vis-a-vis the patient, patient families and physicians. These new mobile applications are providing clinicians increased efficiencies and productivity. And having adequate signal coverage provides a patient and the patient family an increased satisfaction of care.

The issue however is that hospital construction does not lend itself very well for the cellular signals from the outside environment to penetrate every nook and cranny of the facility. The present need for this in-hospital coverage has spurred the growth of DAS (Distributed Antenna Systems).

The Business Models for In-Building Coverage Solution

What has been the traditional business model? It all starts with complaints emerging that the smartphone the physician uses simply does not work, or has spotty coverage and communications with their office and patients and their families is compromised. Hospitals also have now recently recognized the importance of enhancing the care process so providing adequate signal coverage for the patient and their families becomes a marketing quality differentiator.

As the result of these complaints, the IT department or facilities department – if they have a contract for coverage –  typically calls the carrier. Carriers will then evaluate their contract relationship – if there is one – and they will technically assess the coverage area or non coverage in the facility. From either contract side, they may look at the ARPU (Average Revenue per Unit) and that will justify the investment in providing adequate coverage. Or they may simply look at providing the required coverage for a marketing value. At the end of the day, whatever technology they implement for enhancing coverage will be limited to pretty much to this single carrier approach and at the lowest cost to do the job.

A new enterprise business model, however, has changed things… With the advent of the smartphone, physicians want to carry their device of choice, versus accepting what the IT department may give them. Every patient and/or their family member is now carrying some sort of cellular device and/or smartphone as well.

As a result of this new business model, enterprise in-building coverage needs to be multi-carrier. That’s because now, the customer is the physicians, clinicians, and patient families. And this presents a unique issue as in the aforementioned previous single carrier model…a single carrier is highly reluctant to provide coverage for the other carrier, i.e. their competition.

Healthcare systems now have the opportunity to create a business and technical model to satisfy these new business requirements. This new business model will allow the hospital to own the “technology”, whereby having an integrator implement this, all the while providing the carrier’s the opportunity to participate in the potential funding of the implemented in-building coverage solution.

Another alternative business model has surfaced whereby some integrators are suggesting the healthcare system simply “lease” the proposed technology/or solution from an outside entity. This is something like a landlord and tenant agreement. We call this a Shared DAS Model.

Why a Shared DAS Model Works

The Shared DAS Model has several advantages:

  1. This will allow the healthcare system look to the carriers for participation in the funding of the system.
  2. The healthcare system now has the ability to actually look to the best technology out in this space, versus settling for either what the carrier proposes, and/or outside leasing company.
  3. The cellular technology evolution is not static…it is constantly moving forward. For example two years ago 4G or LTE was not even being discussed. If a carrier or an outside entity that “owned” the DAS implemented the proposed in-building coverage solution, how could the healthcare system be ensured that the proposed DAS solution would meet their future requirements?

When the healthcare system actually “owns” the in-building coverage system, the overall total cost of ownership over the life of the system is actually much lower and there is protection of the technology investment.

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2 Responses

  1. […] our previous post, we introduced the business case for Distributed Antenna Systems (DAS) in the healthcare […]

  2. […] our lead-up to HIMSS12, we have explored the wireless world within the hospital that is driving the need for Distributed Antenna Systems (DAS) to provide coverage throughout every nook and cranny in the building or […]

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