American Well Porter 5-Forces

For an online clinic business model, such as American Well, here is a brief synopsis of how one could apply the traditional Porter 5-forces model to this emerging business:

Power of Customers - LOW (applies to both of American Well's customers - the insurance companies who pay providers and could use this service to reduce medical costs, and the end consumer i.e. patients because both benefit from this service which fulfills an unmet need)

Threat of New Entrants - LOW for the short term but HIGH medium- to long-term (2 reasons - 1. Upfront capital investment needed to build the technology and software that drives this product. In public statements, company officials have put that figure in the $70 million+ range. But in the long-term another company can invest that much money or even more, in better technology, and 2. ensuring patient-doctor interactions and related records meet Privacy standards and laws will drive adoption by both physicians and patients)

Threat of Substitutes - HIGH (Substitutes would be walk in clinics such as Minute Clinic, emergency room or urgent care centers and booking a good old fashioned doctors appointment at a primary care clinic; essentially the existing clinical care delivery models)

Power of Suppliers - LOW (there are already so many competitors on the market, as a result suppliers do not have much power. Power of suppliers is only high if it is a niche market and supplies are limited. i.e. its the only supplier in a particular area that can supply a particular material).