Industry Reacts to Lifeline’s “For Sale” Sign
When PERS Insider, the only publication focused on the medical alert industry, broke the news in our last issue that Philips was putting its Lifeline PERS division up for sale, we were curious to hear the industry’s response.
According to multiple industry insiders: There’s no surprise that Philips is jettisoning the once venerable brand.
“Philips knows it never did a good job with its acquisition of Lifeline,” said tech industry analyst, and founder of Aging and Health Technology Watch’s, Laurie Orlov.
Philips acquired Lifeline back in 2006 for a price tag of $750 million dollars. At the time of acquisition, Philips CEO Gerard Kleisterlee hoped Lifeline would lead Philips to becoming a “global player in the evolving home healthcare market.”
But as one industry veteran, who asked to remain anonymous, put it, Philips approached the PERS market from a consumer standpoint, and didn’t understand the industry’s unique attributes.
“PERS is a different creature. If you’re going to run your program right, it’s very much person-centric instead of a box and button product,” said the PERS company owner.
Other missteps involved Philips’ approach to technology. The industry vet went on to say,
“I think Philips has been slow to come to market [with new PERS products] given their resources and technology. That has been a huge hindrance in their continued success in the PERS industry.”
Orlov generally echoed that point, “Philips’ clumsiness gave opportunities to others to compete aggressively against them.”
Another industry leader, who requested anonymity to share unfiltered thoughts about Philips, said, “I think they’ve run the Lifeline name into the ground. They’ve lost program after program, dealer after dealer.”
Firm news on any interested buyers hasn’t yet emerged, although Best Buy is regularly mentioned given their track record of acquisitions in the space, including consumer-focused Great Call in 2018 and healthcare-focused CST in 2019.
When Mark Sandler, the well-known industry mergers and acquisitions adviser, was asked about the bidding process, he responded, “I don’t think there’s going to be an auction. I think this is going to be a targeted sales process.”
Much remains to be seen, but Matt Newton, President of Alert Response, a PERS provider based in Texas, is happy to hear news of Philips selling the once iconic Lifeline business, “They had all the resources: They had the name, the history, and for years and years they’ve struggled to turn it around.” When asked his thoughts on Philips’ plan to sell Lifeline, he said he wasn’t surprised and stated, “I think it’s good for the industry.”
He goes on to say, “I hope their subscribers go somewhere where they’re well taken care of, and the employees of Lifeline are taken care of as well.”
PERS Insider will continue to report on the Lifeline transaction as more details emerge.
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