Jitterbug's acquisition of mobile personal emergency response system (M-PERS) start-up MobiWatch this week was demonstrative of a business model and device strategy that doesn't seem to work in today's wireless health market. MobiWatch's planned offering, MobiFob, was a key-chain with a button that connected via Bluetooth to the user's cell phone. When the MobiFob's button was pressed the user's phone would dial MobiWatch's service line, which could then send an ambulance, police or alert the user's care giver. Terms of the acquisition were not disclosed.

Jitterbug has announced plans to integrate the service side of MobiWatch's offering while dropping the MobiFob. Jitterbug stated that "the MobiWatch offering will be further developed by Jitterbug before coming to market" in 2010 as an integrated service that resides on the Jitterbug's phones. We assume that MobiWatch's agreement with Sprint Nextel is of little use to Jitterbug, while MobiWatch's agreement with Cambridge-based emergency response service provider, ProEMS Solutions, was a key part of the deal.

MobiWatch contended that its market research showed that women kept their keys in their hand as a self-defense mechanism, which is why the M-PERS should be embedded in a key chain and not a feature on a mobile phone. That may be true, but the market and investors (MobiWatch was on the prowl for investors) proved otherwise.

Jitterbug's phone service is aimed at those who are looking for a simple mobile phone experience. Their typical user is 55-years-old or older and not necessarily female, as opposed to MobiWatch's planned demographic. One key benefit of small, PERS devices is that they typically have a longer battery life than the average mobile phone, however, MobiWatch's device needed to be tethered to a mobile phone in order to work -- so that benefit is irrelevant since the MobiFob can't work without a charged phone.

MobiWatch clearly understood this as it also offered a one-touch, speed dial option for its users who preferred not to carry the MobiFob device along with their mobile phones. Jitterbug seems to believe that its users would prefer that set-up, too.

Does the acquisition of MobiWatch point to zero market opportunity for dedicated, personal emergency response medallions?

No. The next generation of M-PERS devices need to include network connectivity -- not just short-range tethering. To become truly convenient for users they cannot require an extra device, especially since 90 percent of the U.S. population already has a mobile phone.

Qualcomm's now defunct LifeComm business unit developed a MPERS that included the "guts" of a mobile phone but kept an eye on battery life. While that device has yet to come to market, the company has advertised the concept device at various health technology tradeshows, including the recent TEDMED event in San Diego last week. The question for that offering is whether consumers are willing to pay a subscription fee for that service or if there is another business model that would work.

For now, Jitterbug customers will have the opportunity to subscribe to MobiWatch's repurposed MPERS offering, which will hit Jitterbug's unique "Services Store" sometime next year, while the market opportunity for truly mobile, dedicated MPERS devices remains uncertain.