Pango-InnerWireless Merger Raises Hopes and Questions

Late last month Pango, one of the early leaders in the asset tracking space in health care, merged with InnerWireless. Pango integrates location signaling from a variety of different wireless technologies. InnerWireless’ core business is the provision of dedicated radio-frequency (RF) networks within healthcare facilities. Pango, which had around 25 employees, will now essentially become InnerWireless’ location service division.

Pango’s founder Michael Campbell makes two arguments in favor of integrating the companies. First, WiFi tracking isn’t quite good enough for room level location, which requires technologies including 802.15.4 (such as InnerWireless’ Spot product), ultra wideband, and infrared. Secondly those customers who decide to go with an installed radio-frequency distribution system — InnerWireless’ main product — are not interested in also having to integrate other vendors’ tracking solutions themselves. 

Tim Gee of Medical Connectivity Consulting sees the two main players with dedicated networks, InnerWireless and MobileAccess, as being a necessary solution only for the minority of hospitals whose physical layout precludes the easy distribution of WiFi or using cheaper cell phone repeater systems. And as recently noted in DHP, asset tracking has seen relatively little adoption in hospitals thus far.

So is this merger a last roll of the dice for two companies with technologies that aren’t quite suitable for the market? After all, most of the aggressive ROI claims for wireless asset and staff tracking assume low infrastructure costs, as a WiFi network would be installed anyway. While Campbell admits that the market has developed more slowly than he thought, he's optimistic, citing the new additional financing from both sides’ investors as grounds that it’s more than just his optimism. He suggests that InnerWireless might have as many as 45 new customers in the next year to 18 months, and that asset tracking in American hospitals will be a market north of $100 million very soon.

His reasoning? Solving the room level location problem by using a combination of tracking technologies will enable the integration of asset tracking in mainstream inventory management systems, such as that from Four Rivers and St. Croix, and in ADT systems. If hospitals can use asset tracking not just to locate pumps and wheelchairs, but to reduce their beds’ downtime, then they can go on diversion less, and admit more patients. InnerWireless is betting that hospitals will be able to use a more comprehensive wireless distribution and tracking solution to increase revenue.

With some 3000 hospitals already using some kind of asset management solution, and everyone wanting more revenue, the market has potential. But only time will tell if  InnerWireless has the right strategy and technology approach.

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