The fitness tracker maker is looking to acquire smartwatch pioneer Pebble
In what is being touted as a really, REALLY cheap deal, Fitbit is close to finalizing a deal with beleaguered smartwatch manufacturer Pebble for a reported $40M. If accepted, its understood that the deal will be for IP – intellectual property and software – only. The Pebble brand would be slowly phased out, with its all of its products shut down and discontinued over time.
Pebble laid off 25% of its workforce in March of this year. Pebble has also been having some very serious product issues during 2016. They’ve introduced three new smartwatches in July of 2016 – the Pebble 2, the Pebble Time 2 and the Pebble Core. In August 2016, they released a software update for their Pebble Health feature. None of these moves has helped them get past the product issues they’ve been having.
While Fitbit has emphatically stated that they are unfazed by Apple’s dominance in the smartwatch space, Apple’s sales of its Apple Watch has declined 51.6% as of the third quarter of 2016, according to the IDC. Unfortunately, this development hasn’t helped Pebble sales one bit.
Fitbit’s reported acquisition of Pebble seems to be signaling their desire to move beyond the fitness tracker designation that most of their wearables have been labeled as. The company has introduced new leather bands and other premium accessories alongside two new smartwatches, the Charge 2 and the Flex 2. After announcing mixed third quarter results and a projected weak forth quarter, the company’s stock took a 30 percent hit.
If you remember, I reviewed both the Fitbit Surge and the Pebble Time as part of my larger, year long, smartwatch roundup last year. I took a very quick look at both and gave the Surge to my daughter (who put it on for all of 5 minutes before telling me she’d never wear it…) and the Time to a friend at church (who wears it every day). However, I know both of these devices have struggled to make any kind of showing in the smart wearables market.
While Fitbit is truly only looking at a technology purchase, I don’t see why they would want to chase after Pebble in the first place. Pebble didn’t really concentrate on the Apps market with its smartwatches. Their apps and app store never really took off, and the resolution of their displays really didn’t make for anything that looked any better than what you saw on an Atari 2600 back in the day. In other words, their graphics and their displays suck. Fitbit doesn’t have an app store, and even if they did, their perception by the market as a fitness tracker only wouldn’t draw any of the premier developers to their ranks.
I really don’t see the purchase of the technology or intellectual property doing anything for them.
What do you think? Is this a good mashup? Will Fitbit’s acquisition of Pebble’s assets provide anything of value, or are they just wasting their time and money? Talk to me, kids! Meet me in the discussion area below and let me know what you think!