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A Look at Big-Business vs. Small-Business Assistive Technology - Erik Kondo

Updated: Oct 15



No model of the assistive technology ecosystem would be complete without taking into consideration AT product businesses. For the sake of simplicity, AT businesses can be divided into Big-Business-AT (BB-AT) and Small-Business-AT (SB-AT). Generally speaking, BB-AT consists of large companies that develop and manufacturer expensive products for people with disabilities that are primarily paid for by the government and insurers. Whereas SB-AT are tiny to small enterprises that develop and sell products that are usually paid for by the consumer directly.


SB-AT entities are the classic example of the free market at work. Many of these companies are founded by people with disabilities. Typically, a person with a disability, or a friend or family member, comes up with a solution to a specific problem. This person is likely a DIY-ATer. Upon solving the problem, he or she realizes this his/her product could be useful to others in the Adaptive Community and creates a product business to meet this existing need. Unfortunately, it is likely that this business entity is undercapitalized. As a result, unless it gains immediate word of mouth traction, it is common for these entities to make minimal sales due to the combination of lack of effective marketing and the low density of consumers willing and able to purchase the product.


The undercapitalized nature of these businesses means that they are unable to overcome the high barrier to entry created by government regulations/requirements to develop products that will be paid for by insurance companies. Therefore, they are not able to compete directly with Big-Business-AT products and offer consumers competitive alternatives.


A few of these businesses will become successful and have sustained operations, but more of them will not, and will wither and fail in time. The ones that are successful are likely to have created an innovative product that meets a pressing and widespread need within the Adaptive Community. Therefore, successful SB-AT is characterized by innovative, affordable, and desirable products that people with disabilities want enough such that they are willing to pay cash for them.


Profitable SM-AT businesses are frequently bought out by BB-AT. Many SM-AT are unable to protect their intellectual property due to the high costs involved in obtaining a patent. If they have a good idea, BB-AT tends to duplicate it and make their own product in true monopoly fashion. The end result is a continual growing of BB-AT and a shrinking of the SB-AT pool.



On the other hand, BB-AT companies are typically highly capitalized companies that work closely with insurance companies, regulatory agencies, and other aspects of the Medical Industrial Complex. Many times, these entities make up oligopolies with minimal competition. On the positive side, BB-AT provides products and services that meet real needs. Due to their significant capitalization, they are able to spend large sums of money on research and development. They are able to run expensive marketing campaigns that make consumers in the Adaptive Community aware of their products and how these products can enhance their lives.


But there also exists a detrimental side to BB-AT that is rarely discussed. BB-AT profits by creating products that are paid for by third party payers rather than the consumer. Therefore, unlike, SB-AT, there is no demand curve pricing. There is no incentive to create low cost products. There is greater profitability in high priced products than low priced products. Therefore, there is a strong financial incentive to keep innovating more complex and expensive products. In addition, in order to ensure that the pool of potential customers is as large as possible, it is to BB-AT advantage to treat people with disabilities as large monolithic groups. For example, a product that is best suited for a small subset of wheelchair users is typically promoted as a necessity for all wheelchair users regardless of whether or not this is realty the case.


BB-AT, with its immense marketing power and influence on the medical community and consumers, is able to provide solutions for existing needs, but it also can create a need for a high margin (profitable) product. In other words, BB-AT can convince people that they have a problem that they didn’t realize was actually problem and sell them an expensive product to solve this problem, which is paid for (mostly) by the person’s insurance company.


BB-ATs innovate and manufacturer products for profit, but they are also pander to and exacerbate some problems of people in the Adaptive Community to generate more demand. Many times, these problems arise from ablest views of people with disabilities that seek to make them conform to the norms of able-bodied society. Other times, the problems are based on widespread low expectations of the physical/mental capabilities of people with disabilities. The mindset is that because some people with disabilities need a certain product, then all people with disabilities need this product for their health and/or safety. I am deliberately not providing any examples because there is nothing inherently wrong with these products. The problem results when people are led to believe that they need a certain product when they actually don’t. Particularly, when this product results in a physical or emotional dependency upon it.


If you think of BB-AT supplying products to only people with disabilities, you can see that the closer the person gets towards being able-bodied the less value that person has a customer. Conversely, the more severe/complicated the person’s disability, the more value he/she has as a customer. A manual wheelchair user is less valuable as a customer than a power wheelchair user. A power wheelchair user with few health problems is less valuable than a power wheelchair user with more health problems. A person with a disability who can do more for him/herself without AT is less valuable as a customer than a person with a disability who can do less for him/herself and thus needs more AT.


Imagine that a person with a disability is a “cash cow”. The more this person is dependent upon AT, the more cash generated. When BB-ATs marketers talk of making people with disabilities live more “independent lives”, they are do not mean an independence that is self-generated due to the person’s inherent expanding/evolving abilities. They are referring to a state of “independence” that is completely dependent upon their assistive technology.


BB-AT doesn't generate revenue by improving a person’s quality of life if this improvement doesn’t involve the use of their AT. BB-AT makes money when a wheelchair using customer switches from a manual wheelchair to a power wheelchair. But it loses a future revenue stream when a power wheelchair user switches to a manual wheelchair. A highly independent manual wheelchair user who uses his or her own musculature to engage in pressure releases is a less valuable customer than a dependent one who requires (or thinks he requires) a high tech cushion to do the pressure releases for him through the use of an expensive product. In this example, the difference between independent/dependent might be the person’s mindset rather than his physical ability. Mindsets can be influenced by effective and widespread marketing messages.


In conclusion, SB-AT entities don’t have the power to influence people’s perceptions of what they need or think they need. They don’t work hand in glove with the Medical Industrial Complex. They solve real and significant problems for people with disabilities, and if they don’t, they go out of business in true free market fashion. Supporting SB-AT through purchasing their products, or by supporting initiatives for expanding SB-AT will have a much greater effect on improving the lives of people with disabilities than by doing the same for BB-AT.


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