Disruptive innovation could set hearing aid industry on its ear

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Hearings aids. Photo: anjan58/flickr

For the last couple of years my hearing has been failing me. I can't completely understand dialogue in Marvel movies, conversations in bars or, lately, even one-on-one conversations in a relatively quiet room.

But, I've been reluctant to get hearing aids. Partially that's for reasons of vanity. I don't want to look like an old man, despite the fact that my grey male pattern baldness, hair-filled ears and deepening wrinkles are not fooling anyone.

Having thin wires disappearing into my auditory canals from what look like silver tangerine segments behind my ears was just a bridge too far.

But there is another and equally important reason for my reluctance. I think the hearing aid industry is ripe for disruptive innovation.

This really came home to me a couple of weeks ago when I caved to reality and explored my hearing aid options at a local audiologist. She was a pleasant young woman who explained why it was that two hearing aids can cost as much as three new iMacs.

She told me that I would really be paying for the hardware itself, the R&D that went into it and, of course, her expertise as a professional who could accurately assess my hearing and tune hearing aids precisely to my needs.

I have no issue with her expertise and education. I appreciate the time she took with me. But the rest of the argument is patent nonsense. Which is why I think the hearing aid industry is in for a rude awakening from Google, Apple or some other tech company.

Trial run

I got a loaner pair of hearing aids from the audiologist. They were two crescent-shaped grey plastic cases with silicon-covered receivers attached to them by thin, flexible wires. They, frankly, looked like a creaky gizmo you'd buy in a Skymall catalogue for $49.95 if you were drunk on a long flight.

When I got them home I realized I didn't ask how to turn them off. I then discovered it was easy. You just had to open the tiny battery case in each and let the energy cell protrude out a bit.

That was a unique technology experience for me. I would be paying up to $6,000 for an electronic device I had to open the battery door on to shut down. I imagined having to do this with a digital camera, laptop or even portable radio that cost $7 on Amazon. And, I pictured the devices shorting out if I accidentally wore them in the shower since the battery housing clearly isn't sealed.

The hearing aids came in a plastic case that did nothing but contain them. When I shook the box slightly I could hear the loose devices rattling around inside.

The audiologist told me I could use the hearing aids with Bluetooth. That way I could listen to calls and music coming from my iPhone. That's true, but to do it, I would have to hang a device the size of a hockey puck around my neck so the inductive signal from the wire necklace could communicate with the non-Bluetooth-capable hearing aids. The kludginess of that solution is almost laughable. And, the audio quality, even for podcasts, was tinny and dreadful.

Comparing devices

It was hard not to compare the hearing aids to my Apple AirPods. These are also small devices that pipe sound into your ears. The AirPods are elegant pieces of industrial design. In their small housing they contain a microphone, an earphone, a digital signal processor, a Bluetooth receiver, a rechargeable battery, an accelerometer and a proximity sensor. And, I can summon Siri with two taps on the side of one AirPod. Their case is like a smooth, white river stone. The AirPods snap into it and are held snugly. That case also acts as a charger for the devices.

The AirPods connect directly to my phone via Bluetooth and deliver rich, stereo sound. And they can go through a wash cycle without damage.

Plus, they cost under $200. Other manufacturers like Bose, Google and Jabra make similar devices. The Jabra can even monitor heart rate and Google's set can translate dozens of languages in real time.

Now, of course, these are earpods, not hearing aids. But, from an industrial design, electronics and hardware point-of-view, it is a fair comparison. In fact, most earpods have more, not less, electronics in them than hearing aids.

Where they differ from hearing aids is in the software. The chip in hearing aids samples audio a million times a second. It is programmed to work specifically for the unique type of hearing loss sufferers live with. And, a lot of R&D goes into the design of that chip and the tuneable software that it contains.

Audiologists argue that a good chunk of the cost of hearing aids is that R&D expenditure. But Bose, Google, Jabra and Apple also have significant R&D investments wrapped up in their devices. Case in point: Apple has 100 engineers alone working on the camera in the iPhone.

Plus, much of early R&D costs for electronic devices is amortized over the first few years of a device's creation. Ongoing R&D expenses make up a small portion of the overall cost of a shipping product compared to marketing, retail markup and production costs.

Now, Apple, Google, Bose and others have a huge advantage in economics of scale when they make their products. Which is why the Big Six hearing aid companies should be nervous.

Primed for disruption

They are in a classic disruption space. They are incumbents in an industry that offers a high-cost product and are dependent on that high cost and the business models that support it. A good percentage of folks who need hearing aids don't have them because of that cost. They are actively seeking a cheaper solution. That's why small disrupters such as online hearing aids sales companies like Audicus and big box stores like Costco are making a tiny dent by offering cheaper, though often inferior, solutions.

But they're not the real disruptors. Apple has already invested millions in health research for its Apple Watch. The rich data sets and expertise on wearable health monitoring can be translated into ear-centric wearable health devices. It has state-of-the-art audio labs and is exploring augmented reality glasses that will probably contain augmented audio as part of the experience. And, of course, it has AirPods that will get smaller and more powerful in the next few years. And Apple is a demonstrated master at stepping into an industry with lousy user experience and cleaning its clock.

Google has shown with Google Photos that it can use machine learning to study millions of images and produce an AI that gets better and better at recognizing trees, sheep, canoes, etc. in those images. That same technology applied to crowdsourced soundwaves and applied dynamically to existing earpods could dramatically improve the devices' abilities to process real-world sound.

None of this will happen next year, but I bet in five, the hearing aid industry will be set on its ear. In the meantime, I'll spend my hearing aid money on an iMac, a laptop and a big screen 4K TV and still have cash left over for another set of AirPods.

Do I wish I could hear better now? Of course. But I don't want to be a chump with Skymall junk in my ears. So, I'll keep holding out for a better solution. If you hear of one, give me a shout.

Wayne MacPhail has been a print and online journalist for 25 years, and is a long-time writer for rabble.ca on technology and the Internet.

Photo: anjan58/flickr

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