This is really sad; Pebble had probably the best products on the smartwatch market, and I'll be disappointed to see them go.
They were the only smartwatch manufacturer that could claim anything close to 10 days of battery life. They were the only smartwatch manufacturer that made devices that were water resistant and really meant it. (That is, they're all rated to 3-5 ATM and tested the same way regular watches are, you can actually use them in chlorinated or salt water, and they didn't try to claim that your "water resistant" device's warranty was void if you got it wet.) They were the only smartwatch manufacturer that made devices that had an always-on display that's actually any good (with the possible exception of the just-released Gear S3; I've yet to see one in person but it sounds like Samsung are getting there). It's a small thing, but they were also the only smartwatch manufacturer that didn't take themselves too seriously, filling their UI with cute icons and animations that made the watch fun to use. All that, and their products were significantly more affordable than some of their competition.
Agreed. I still like my Time (did yours die?), but I am one of the affected PT2/Core backers (and Pebble advertising other KS projects like hell means that I also backed a GPS strap/addon for the now DOA PT2. Yay).
It feels like I'm starting to like a market and it dies. Like watching Firefly after the show was long cancelled. Back to bare wrists for me, alternatives do not exist. :(
That's a really really old model. I haven't used one recently - I'd say look at Amazon reviews. Friends who have bought them swear by them and my experience with them was exceptional.
It really depends on your price tolerance and features you want. Pricing really wasn't an issue for me, and my activities are all across the board from running to biking to swimming to weight lifting, etc. - so I went with a Fenix3 HR.
I'm still stunned how much better the battery life is given the features it has. And the built-in GPS is SO NICE - but then again you'd kind of expect that from Garmin.
"New products, Fitbit BlazeTM and AltaTM, including related accessories, comprised 54% of Q216 revenue".
I don't know how revenue is split between the two, but it sounds like they're selling a lot of blazes.
Edit:
"In the first quarter, Fitbit sold 4.8 million wearable devices, including one million of the Fitbit Blaze and another one million of the Fitbit Alta."
Now this is first quarter data (when Blaze + Alta did 50% of overall revenue). Since Blaze costs 199$ and Alta 99$, one could split the revenue Blaze (33%) and Alta (17%) roughly.
One third of Fitbit revenue from Blaze (smartwatch) - that's a LOT!
Fitbit had revenues of $14.5 million in 2011, $76.4 million in 2012, $271.1 million in 2013, $754 million in 2014, $1.8B in 2015 and is expected to do $2.4B in 2016.
Stock down more than 70% year-to-date, and competing in a market that is rapidly becoming commoditized.
Perhaps "failing" is a a strong word, but I wouldn't describe them more positively than "struggling." Like GoPro, Fitbit sells commodity hardware and is not greatly differentiated from its competitors in terms of hardware, software, or platform lock-in (you may disagree, but the consumer market has clearly spoken).
Their hardware and marketing are good, but software not so much - which is where magic happens. Completely agree that when it comes to software and user experience - Fitbit feels like a 'commodity'.
The 30% fall was mainly triggered by Fitbit revising revenue estimates for Q4 from 985M to somewhere around 725M as well as Q3 performing poorer than expected.
What's fascinating is that Fitbit is still going to do about 2.2B in revenue (up from 1.8B) last year. So annual revenue is going to be more than current market cap (1.7B).
Apart from a less than delightful user experience (resulting in device abandonment and low engagement/retention), Fitbit is also losing market share to Xiaomi in Asia.
So I wouldn't call it failing, but yeah it could do much better :)
> Completely agree that when it comes to software and user experience - Fitbit feels like a 'commodity'.
I don't just mean that. I mean that anybody with business contacts in China could make equivalent fitness-tracking hardware. The barrier to entry for new competitors is very low.
Fitbit needs to be able to prevent a bunch of new competitors from coming out of the woodwork and stealing their marketshare.
PS: I can't reply to the followup post to this post, so answering here. If you go to CES, you'll find a hundred companies that make a fitness band (I did, last year). None of them have Fitbit's branding and name recognition (which is very non-trivial to create).
XM and Sirius got together. Not sure if it's working out or not but they're still an operating business which is better than where they were headed pre-merger.
I would say it's a half-decent example, but I wouldn't put too much trust in that considering it was Steve Jobs the one that made it work, and he was no run-of-the-mill CEO. It's a little like saying that starting a new (successful) car company is easy because Elon Musk did it.
Anyone have a good alternative to the Pebble Core that runs some kind of open OS (Linux/Android) with 3G built in a very similar form factor? Will take suggestions from AliExpress even... Wish I would have just gotten my Pebble Core instead :/
You could strap a ESP236 to a bluetooth or NRF module- those things have a lot of processing power, wifi, etc, and add a little battery. They've got good power consumption, are cheap as hell, and should work.
A lot of the signals here are pointing to a result of Pebble getting as much as they can at this point without anyone having to actually fulfill undelivered promises. Sad, but such is the way of backing things on kickstarter and equivalent sites.
The key focus of this acquisition seems to be the acquisition of assets (read 'IP'). Fitbit has had a rough time battling Jawbone in court (though ironically Jawbone has been the sufferer in the market while Fitbit revenue keeps going up). I feel that has made them cautious about IP and this is the second acquisition (after Coin) that's been purely focussed on acquiring IP so that:
1. Others can't acquire and sue them
2. They can sue others if needed
Other than IP, it's hard to justify their spend in acquiring the company (they already have hardware and software/app).
What have pebble and coin done to get this IP? Just had enough patent lawyers around to patent stuff they happen to be working on ("Method of having an e-ink watchface")?
You usually acquire IP by inventing something, and then filing for patents based on the invention, if that's what you're asking.
To be fair, I don't think Pebble was aspiring to be acquired by Fitbit for their IP. They turned down a huge acquisition offer, presumably on the notion of getting bigger. This was just a fire sale which barely returned money to debt holders (and maybe some to investors).
Same thing with Coin. In fact, Fitbit only acquired a portion of that company.
That's how the game is played, yes. If Fitbit has been on the receiving end of of patent problems, it's no surprise that they're very interested in patents.
Typically, key engineers from the acquired company will have some sort of bonus tied to staying for a length of time. When LG bought the webOS group from HP, many got bonuses payable after one year, for example. That gives them time to maybe convince some to stay, and to get the value needed for their own internal teams to take over the technology.
I think the Pebble brand has decent value. It is positioned as the "first" smartwatch for a niche of users that you can build around. No idea how valuable exactly the brand is as figuring that out seems like witchcraft to me.
is there data or statistics about this topic?
i'm sure someone with access to this data could determine if market impact and recruitment costs would make it worthwhile
~60 engineers and managers retained as part of acquisition. 1 left before acquisition was final. ~15 left before 1 year cliff. ~30 left within 6 months after the cliff. ~15 are still there after 2 years.
There was a company wide layoff a few months after the 1 year cliff. The acquired teams weren't hit as hard, because it was understood that people would leave on their own.
"The deal will mean the Pebble stock held by employees is worthless, two of the people said. The money will instead go to debt holders, vendors, some of its main equity investors, and Kickstarter refunds for the Time 2 and Pebble Core orders, the people said."
They don't have a $33mm Kickstarter obligation to take care of. Their most recent project raised $12.8mm for the Pebble 2, Time 2 and Core. According to this rumor, they intend to refund people who pledged money for the Time 2 and Core.
Doing some quick math, it looks like they plan to refund $9,650,775 (plus any amount people pledged above the minimum threshold for a given pledge tier). Of course they're returning the full value on money they received after Kickstarter's 10% cut. They would have only received about $8,700,000.
Thanks, I was making a (bad) guess about what had been successfully delivered. Hm, that makes the reported $40mm price closer to having money falling on common, but probably not close enough. Did the $15mm series A have a 2X liquidation preference?
Without knowing any details about their business, my guess is that they also have substantial debts with their manufacturing partners.
Since they kept going back to the Kickstarter well, maybe their business never got to the point where the fundamentals made sense -- after all, they were selling a $99 Pebble Core for $69 (actually $62.10) via Kickstarter. That kind of thing really eats into your margin.
Maybe they thought the Kickstarter customer base was just the most enthusiastic 10-20% of customers, and if it turned out to be 90-100% of customers they were left with production costs that didn't work. If you don't hit scale on production, you still get to pay the giant upfront costs.
At any rate, why liquidate the company if they had enough money in the bank to pay the entirety of your debts. A company at that point will hope that there might still be a way out.
They were the only smartwatch manufacturer that could claim anything close to 10 days of battery life. They were the only smartwatch manufacturer that made devices that were water resistant and really meant it. (That is, they're all rated to 3-5 ATM and tested the same way regular watches are, you can actually use them in chlorinated or salt water, and they didn't try to claim that your "water resistant" device's warranty was void if you got it wet.) They were the only smartwatch manufacturer that made devices that had an always-on display that's actually any good (with the possible exception of the just-released Gear S3; I've yet to see one in person but it sounds like Samsung are getting there). It's a small thing, but they were also the only smartwatch manufacturer that didn't take themselves too seriously, filling their UI with cute icons and animations that made the watch fun to use. All that, and their products were significantly more affordable than some of their competition.