Strategic pathways of digital health platforms in regulated markets: Evidence from wearable devices

Wearable digital health platforms increasingly operate at the boundary between consumer wellness and regulated medical applications. While platform strategies such as openness toward complementors have been widely discussed, less is known about how digital health platforms strategically balance openness, closedness, and regulation over time in real-world healthcare settings.

This study aims to examine how direct-to-consumer digital health platforms navigate regulatory environments and how strategic differences shape divergent innovation trajectories.

We conducted a qualitative comparative case study of two leading wearable digital health platforms, Fitbit and Apple Watch. Using longitudinal secondary data on product launches, FDA-certified applications, clinical trial activities, and partnership histories, we analysed platform strategies at the levels of product development, market expansion, and business development.

The analysis reveals contrasting strategic pathways. Fitbit, as an early entrant, initially achieved market leadership through wellness oriented applications but became constrained by path-dependent strategies and limited regulatory engagement. In contrast, Apple leveraged regulatory reforms to introduce FDA-approved medical applications, combined openness toward third-party developers with closed control over core technologies, and actively engaged with regulators to create new growth paths. These differences resulted in divergent innovation trajectories despite operating in the same product category.

This study demonstrates that regulation plays a central role in shaping digital health platform innovation, functioning not only as a constraint but also as an enabler when strategically integrated. By positioning regulation alongside openness and closedness as a core strategic dimension, the findings contribute to understanding how digital health platforms can sustain competitiveness in regulated environments and offer practical insights for managers and policymakers involved in digital health implementation.