Building an Online Ramp for Older Americans: ElderVision Launches First Integrated E-Service For Seniors.

Business & Technology Editors

PITTSBURGH--(BUSINESS WIRE)--Sept. 7, 2000

Mouse & Keyboard-Free Technology Eases Older

Computer-Phobes Across the Digital Divide

Company Targets Retirement, Assisted Living Communities

Seeking to Wire 2.5 Million Senior Residents

Nationally With New "TouchTown" Service

Simple Touch Screen Offers E-mail, Web Shopping and News Links to Vast Majority of Seniors Not Yet Online. Developed by Successful Software Entrepreneur Who Watched His Father Lose Touch in a Nursing Home. Three Senior Residences First to Be Wired, thanks to Efforts of Company's "Council of Elders"

Older Americans, largely left on the far side of the digital divide by computer phobia and the challenges of coping with tiny type on a busy screen, now have an online ramp to the New Economy.

ElderVision, a software and e-services company focusing on the senior market, has rolled out its new interactive TouchTown(TM) service, enabling seniors to e-shop, e-mail and access news and information on the Web without having to use a traditional mouse and keyboard computer. The company is conducting field trials with three established Pittsburgh retirement communities, with a group of seniors ranging in age from 70 to 82.

Until now, seniors have largely been no-shows to the digital party - less than ten percent of Americans 65 and older are estimated to be using the Internet, especially those living in retirement communities. That may be about to change as several e-companies have announced plans to target the large, vastly underserved senior market. ElderVision is the farthest along in development, with a breakthrough Internet appliance and a basket of services designed specifically for the original E-generation.

ElderVision is the brainchild of Jeffrey Pepper, founder of ServiceWare, Inc., a leading customer support software company he established in 1991. Mr. Pepper resigned as ServiceWare CEO in 1998 to concentrate on finding ways to improve the quality of life for millions of older Americans. The result is ElderVision.Net, a company that is transforming standard digital technology to accommodate users unaccustomed to point-and-click navigation and Web surfing. ElderVision's software and Internet touch-screen are easily understood to seniors whose physical challenges and anxieties have kept them on the sidelines of an online world.

"The existing computer model is simply elder-hostile," said Mr. Pepper, who has been an instructor of computer programming as well as a software developer. "Even basic Windows applications can be extremely complex and taxing on short-term memory, while most PC and laptop functions place considerable strain on the hands and eyes."

As for the Web, Mr. Pepper notes, "despite its tremendous promise, it's largely an environment designed by 20-year-olds for other 20-year olds - cluttered, edgy, going in a hundred directions at once. Our aim was to create a simple Internet-based product that can be intuitively grasped by seniors coping with age-related challenges to motor skills, vision or cognitive abilities, and who may not be attuned to the ironic sensibility that colors so much of Web culture. Instead of seniors being forced to adapt to Internet technology, our goal has been to adapt Internet technology for seniors, which is why we've thrown out so much of our existing assumptions about the Net.."

Touch Screen Gateway to Online Communications

After interviewing hundreds of seniors about their apprehensions toward computer use, ElderVision created a touch-screen device that eliminates the need for a keyboard, mouse, or hard-to-use touchpad, while adding the ability of voice tools. The company's TouchTown service draws more from a picture phone or an ATM touch-screen than a personal computer. All of the product's features - from e-mail and shopping to an online newsletter and select access to Web browsing - are activated by touching large pictures and photographs that connect subscribers with the appropriate offering or service. TouchTown e-mail supports text as well as voice-format messaging.

Among the more welcome services offered through TouchTown is a personalized and patent-pending Web-shopping feature - subscribers can link by speaker phone with an ElderVision shopping agent who guides them through e-commerce sites, delivering select screen shots of merchandise without the confusing detours that characterize the typical e-tail experience. ElderVision agents also help seniors access information from the Web - pages from a popular health site, investment news, an article about fitness, even a medication schedule.

The service also features a community newspaper called TouchTown Today, which carries personalized news and announcements - daily menus, the weather, on-site entertainment and other events. Through a pending alliance with online news providers, TouchTown subscribers will have a link for obtaining local, national, business and other news.

Targeting Nation's 20,000 Retirement Communities

Rather than selling to the estimated 25 million U.S. seniors directly, ElderVision is marketing its services to retirement and assistant living communities, where more than 2.5 million Americans over 65 live in an estimated 20,000 facilities nationwide. Revenues will come from monthly subscription fees paid by client facilities, commissions on e-shopping transactions as well as affinity e-commerce relations, and selected advertising on TouchTown Today's news and information pages. Over time, the product could represent a large and attractive subscriber base linking retirement care communities across the U.S.

ElderVision also wires client facilities so that all residents within a community are linked with one another. Subscribers will also be able to use TouchTown to communicate directly with on-site medical and administrative staff, as well as with family members and friends elsewhere who have downloaded the company's e-mail software. The company's goal is to establish a full-circle network that can substantially improve the quality of communications among seniors who have moved to community or care-based residences.

"As an e-commerce provider, we are looking to serve a much-neglected market -- the millions of elderly Americans who haven't benefited from the Internet revolution," said Mr. Pepper. "ElderVision can also foster community links and help seniors avoid the isolation and depression that diminish the quality of life for too many retired people."

Early Support from Senior Communities

Field trials for Touch Town are nearing completion at three Pittsburgh-based retirement communities - Sherwood Oaks, Longwood at Oakmont, and Weinberg Village. Several dozen residents, whose average age is 77, are participating in the trials. TouchTown software has also been distributed to family members, including relatives throughout the U.S., enabling them to share e-mail and other virtual activities with their older relatives.

"We're pleased to be among the first to test and install ElderVision's technology, which brings seniors a major step closer to everyday online communication now enjoyed by the rest of the population," said Mark D. Bondi, President of Sherwood Oaks. "Right now, TouchTown is a differentiator for a provider like us, but I suspect it will not be long before ElderVision's model becomes the standard for all retirement and care-based communities."

Although no one doubts the huge purchasing and political power enjoyed by seniors, as a group they have been largely ignored by digital marketers and information providers. Most e-companies targeting "older" Americans confine their reach to those between 50-64 years of age, accepting the common assumption that those 65-and older are beyond the arc of the New Economy.

Mr. Pepper challenged that view in a recent commentary, "Serving the Unwired Generation," in which he wrote: "The low rate of Internet connectivity among the elderly should be a challenge to e-commerce providers rather than a reason to walk away from this enormous market on the assumption that seniors are too infirm, too stingy, or too disinterested to participate in the online economy. The Internet could be a real boon to the elderly, helping to overcome serious problems of old age and providing fast access to information on everything from insurance benefits to nutrition, not to mention opening new virtual worlds just as it has for the rest of us."

The challenge is beginning to resonate. Other senior-oriented Web sites and product offerings have begun to emerge in the past year. In June, Compaq Computer Corp. and PacifiCare Health Systems announced a jointly operated Internet site to provide e-marketing services to senior citizens, with Compaq contributing $18 million to the venture.

An Idea From A Father's Plight

Mr. Pepper's idea for ElderVision came after watching his elderly father struggle with loneliness and depression after illness forced him to enter a nursing home in the early 1990s. "I became convinced that an online community would be of great value to older people if we could find a non-threatening means of bringing them to the Web," Mr. Pepper says. "The decline experienced by thousands of seniors is caused largely by the fraying of day-to-day connections with family, friends and community once they retire."

Mr. Pepper gathered a group of Pittsburgh-based seniors in their 70s, 80s and even 90s - dubbed the Council of Elders - to serve as a sounding board. He also brought together a professional advisory board of gerontologists, software designers, human factor experts, and even David Bianco, co-founder of Elderhostel, the popular travel and education group for seniors. Mr. Pepper and several colleagues surveyed over 350 seniors for an understanding of their needs, as well as their fears concerning computer use. Typical was Dottie Friedman, one of the Council of Elders, who spoke for many when she said, "Computers scare the socks off me."

From Mr. Pepper's initial concept of a joy-stick driven ride into virtual reality, TouchTown emerged as an online community and basket of services easily accessible through a touch of the screen and series of voice commands.

VC Funding to Follow Initial Angel Financing

For its initial product development, ElderVision obtained financing from several private "angel" investors, along with seed capital provided by Mr. Pepper, who remains the largest individual shareholder of ServiceWare. The company, with 25 employees, is nearing a new round of venture capital funding to support sales and marketing, as well as production of the touch-screen hardware and voicemail system.

ElderVision expects to realize revenue from three sources, initially relying on subscription fees paid by retirement communities. The company will wire the communities, installing its TouchTown units in resident homes and administrative offices. Fees are built into resident charges in the manner of cable TV and other basic services. Nationwide there are 20,000 retirement communities with 2.5 million residents. They range from assisted living complexes to continuing care facilities, congregate care housing and senior apartments. Senior-based communities are projected to increase dramatically in coming years as more and more Baby Boomers begin to retire.

Shopping, Advertising and a Foundation

ElderVision will collect transaction fees on its e-shopping service, as well as e-commerce and affinity relationships and advertising on TouchTown Today. The company's agents will act as personal Internet shoppers for seniors via speakerphone, so that subscribers won't have to master the ins and outs of the Web to enjoy the benefits of e-commerce or feel secure about their purchases. ElderVision agents - who undergo extensive senior sensitivity training - can cut and paste pictures and descriptions of merchandise from e-commerce sites and present them on a subscriber's screen. The company expects to expand its agent model for delivering other online services.

"If our customers want to see a red sweater or a pair of sneakers for their grandson, we'll show them the product just like any good sales clerk," Mr. Pepper said.

Advertising is the third revenue source. ElderVision will sell advertising space on its TouchTown Today online newspaper. "We are creating a focused online media channel for seniors," said Mr. Pepper. "As we begin to build a sizable network of subscribers in multiple markets, TouchTown Today has the potential to become a powerful medium for reaching a large and established market."

Also in the works is the ElderVision Foundation, which Mr. Pepper is forming as a parallel nonprofit organization to advance quality of life for seniors on multiple fronts. The company's philanthropic arm will provide goods and services to eldercare institutions. The foundation, which will hold a substantial portion of the stock in ElderVision, will also provide seed money to fund new programs and online initiatives working with the elderly.

Note: For more detail, including screen images of TouchTown, visit www.eldervision.net.

Jeff Pepper is the founder and CEO of ElderVision. He was previously CEO of ServiceWare, a company he founded in the basement of his Pittsburgh home in 1991 that is nowa leading provider of customer service software and knowledge content. He was formerly a software designer and product manager with The Carnegie Group. A native of Huntington, NY, Mr. Pepper holds a B.S. in mathematics from Carnegie Mellon University, where he was an instructor in computer science. He has authored two books, written and lectured extensively on technology, and is co-holder of two U.S. patents.