Eden Prairie’s Starkey hopes to expand markets with AI hearing aids

Nobody wants a hearing aid unless they really need one

Starkey Hearing Technologies hopes the fact that so many people walk around with earbuds can be parlayed into greater acceptance of the devices, which are now smaller, smarter and outfitted with AI technology.

Increasing the Size of the Total Market

For Starkey, the biggest U.S. hearing aid maker, increasing the size of the total market, as well as its share of it, is key. New technology and the addition of over-the-counter models has added strain to an already competitive industry.

Recovery and Growth

Starkey had a sluggish 2022, as did the industry as a whole in the aftermath of the pandemic, said CEO Brandon Sawalich.

But now, buoyed by its AI-powered Genesis suite of devices, the company headquartered on 40 acres in Eden Prairie has mostly recovered, Sawalich said. Starkey’s sales are up 8% to 10% this year, and data from the nonprofit Hearing Industries Association reported that hearing aid sales were up 10.5% in the third quarter.

The Advantage of AI Hearing Aids

The advantage of AI hearing aids is that they can recognize different listening environments — the office or your coffee shop — and make adjustments to deliver the clearest experience.

“We can train that signal processing. The patient has to do less work and the signal processing is doing more of the work,” said Tom Powers, strategic adviser with the Hearing Industries Association.

The Genesis Suite

While Starkey is not the only company with AI-powered products, the Genesis suite is making inroads for the company.

“It’s been very well-received in the market,” said Karl Strom, the Duluth-based editor of consumer website Hearing Tracker who has been reporting on the hearing industry for 30 years.

Leadership Changes and Rebuilding

Sawalich took over as CEO of the company after his stepfather, founder Bill Austin, learned that several former C-suite members — who eventually pleaded guilty or were found guilty — were involved in embezzlement.

Sawalich then started rebuilding the company’s leadership, including bringing in Chief Technology Officer Achin Bhowmik from Intel in 2017. The next year, the company started its quest to add AI to hearing aids.

Market Overview and Rankings

Europe dominates the hearing aid market, with four of the “Big Five” industry leaders based there, three in Denmark alone. Starkey — which employs 6,000 in 29 manufacturing facilities, including 1,400 in Eden Prairie — is the only one based in the U.S.

In 2019, a global market overview from Germany-based Statista put Starkey fifth among the five, with 4% of global hearing aid sales.

OTC Hearing Aids and Disruption

The already complicated hearing market became even more so a year ago when the Food and Drug Administration allowed over-the-counter hearing aids to enter the market.

Those do not have the same strict oversight as the prescriptive higher-end aids, but they were expected to turn the market upside down.

While the addition of OTCs has disrupted the hearing aid industry, it hasn’t been as drastic as some experts predicted.

Cost and Insurance Coverage

One reason is cost. OTCs can cost more than $1,000 a pair, Strom said. While Starkey prescription devices can cost $2,000 to $6,000, they also are covered by many insurance plans.

Millions covered under UnitedHealthcare plans, for example, including Medicare Advantage customers, can get prescriptive hearing aids for as little as $175, said Will Shanley, spokesman for the Minnetonka-based insurer.

Targeting Young Adults

Yet a secondary market — especially if the industry can get past the stigma associated with hearing aids — is among young adults. The Centers for Disease Control and Prevention estimates that one in five Americans has hearing loss from noise damage by the time they are 30.

Technological Advances and Customization

The technological advances made by Starkey and other companies can be fine-tuned to the market. For older users, they are programming in such features as sensors that can detect falls. For younger users, there is a noise-canceling option (similar to that in some earbuds) and even language translation.

Hearing is Healthcare

But Sawalich wants customers to know that hearing aids are not simply cool little gizmos.

“Hearing is health care. It’s not a consumer electronic,” Sawalich said.

The Genesis AI Aids

The Genesis AI aids, unveiled in February, required “all new everything,” Sawalich said. From new software and design for the aids themselves to a new smartphone app and a longer-lasting lithium battery.

Positive Reviews and Recommendations

While not everyone is as enthusiastic, Brad Ingrao, a nationally recognized audiologist, recently recommended Starkey’s AI devices over those of one of its biggest competitors, ReSound, in a review for Seniorliving.org.

Ingrao, official audiologist for the International Committee of Sports for the Deaf, gave both hearing aids good marks but noted one area where Starkey has an edge: “They also offer some of the industry’s first hearing aids that feature health, wellness and safety features backed by AI technology. These features include fall detection, step tracking and daily brain activity reports.”

A History of Innovation in the Twin Cities

The

SDGs, Targets, and Indicators

1. SDG 3: Good Health and Well-being

   • Target 3.4: By 2030, reduce by one-third premature mortality from non-communicable diseases through prevention and treatment and promote mental health and well-being.
   • Indicator 3.4.1: Mortality rate attributed to cardiovascular disease, cancer, diabetes, or chronic respiratory disease.

   The article discusses the advancements in hearing aid technology, particularly AI-powered devices, which can improve the quality of life for individuals with hearing loss. By providing clearer experiences in different listening environments, these devices contribute to promoting good health and well-being for individuals with hearing impairments.

2. SDG 4: Quality Education

   • Target 4.5: By 2030, eliminate gender disparities in education and ensure equal access to all levels of education and vocational training for the vulnerable, including persons with disabilities.
   • Indicator 4.5.1: Parity indices (female/male, rural/urban, bottom/top wealth quintile, and others such as disability status, indigenous peoples, and conflict-affected, as data become available) for all education indicators on access, participation, and achievement.

   The article mentions that hearing aids are not just consumer electronics but a form of healthcare. By providing individuals with hearing loss access to hearing aids, it ensures equal access to education and vocational training for persons with disabilities, including those with hearing impairments.

3. SDG 8: Decent Work and Economic Growth

   • Target 8.5: By 2030, achieve full and productive employment and decent work for all women and men, including for young people and persons with disabilities, and equal pay for work of equal value.
   • Indicator 8.5.1: Average hourly earnings of female and male employees, by occupation, age, and persons with disabilities.

   The article discusses the hearing aid market and the growth of sales in the industry. By creating demand for hearing aids, it contributes to economic growth and employment opportunities in the hearing aid manufacturing and distribution sectors.

Table: SDGs, Targets, and Indicators

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Source: startribune.com

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