Fitbit Is Buying Smartwatch Maker Pebble For Around $40 Million, Says Report (techcrunch.com) 94
According to a report from The Information, Fitbit is buying smartwatch maker Pebble for a "small amount" of money. One source says Fitbit is paying between $34 and $40 million for the company and is "barely covering their debts." TechCrunch reports: A source close to the company told TechCrunch that watch maker Citizen was interested in purchasing Pebble for $740 million in 2015. This deal failed and before the launch of the Pebble 2 Intel made an offer for $70 million. The CEO, Eric Migicovsky refused both offers. Pebble released the newest version of its smartwatch in October, but the past year or so has been a challenging period. It laid off 25 percent of its staff in March, while we reported last year that it was in some trouble and had turned to debt funding and loans, as well as traditional investor cash, "in order to stay afloat." Earlier this year, Pebble CEO Migicovsky confirmed that his company had raised $28 million in debt and venture financing. He blamed a more cautious outlook from VCs focused on tech as the primary reason for letting 40 of Pebble's staff go.
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Fitness bands and smartwatch sales are tanking. It looks like it's just a fad.
Or the technology isn't there yet.
Remember the 'fad' of the Palm Pilot and Apple Newton? The technology wasn't there yet and now smartphones.
Re:Realistic (Score:5, Interesting)
Or the technology isn't there yet.
Remember the 'fad' of the Palm Pilot and Apple Newton? The technology wasn't there yet and now smartphones.
I disagree with this sentiment strongly. Palm Pilots were fantastic. The lack of popularity wasn't anything to do with tech. The tech was there, it just wasn't sexy. You need to make it stupid and give it a selfie app before it's popular, but that has nothing to do with the tech being there. It's not even a matter of viability. Niche markets exist, and Palms were largely marketed to business users anyway, who loved them.
The only reason smartphones are popular is because they have been made sexy to a mass market who uses them largely to waste time. There's nothing wrong with that choice, but we should acknowledge that demographic as the primary. Palm users were running businesses and managing teams off of them. Your average smartphone user is using instagram or the ilk.
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The butthurt is strong in this one.
Re:Realistic (Score:4, Informative)
Palm Pilots *may* have been fantastic but they were not a product for the masses. At the time, these devices were known as PDA's because they were niche, focused products that addressed a specific need. They were not general purpose computers that smartphones are now. GP is right, the hardware just wasn't there yet.
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I owned a palm and continued to use a paper day planner, the office I worked in at the time never bought into palm, so the benefits didn't outweigh the hassle.
Who's to say how it would have worked out if they had gotten a ubiquitous cell/data module instead of their old crawling wireless network and made use of touch better.
The technology was there, palm just didn't put it together. At the time even with full palm buyin, you were carrying a phone and a palm.
The cell addon was buggy, late, huge and wo
Palm apps eco-system (Score:4, Informative)
focused products that addressed a specific need.
They were *marketed* for specific needs...
They were not general purpose computers that smartphones are now.
They were the exact precursor of smartphones now :
they were general purpose computers, on which you could install tons of additional apps to extend functionality.
(with SDK and documentation provided by Palm).
After PSION with their EPOC OS (ancestror of Nokia's SymbianOS),
Palm's PalmOS was the next big eco-system that saw big development of 3rd party apps.
It is dwarfed by the current Android and iOS apps ecosystems, but back then it was quite an achievement.
You could find and install game, web browser, email client, GPS/Nav software, console emulators, some very domain-specific apps (Epocrate, a medical drug database started its life on PalmOS), etc.
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Our company was a bunch of geeks. we had an original pilot (before Palm bought them). It was a tool for geeks. the whole Graffiti thing made it hard for people to just pick one up and use them. the sync software was a bear to use and felt like an infestation on your system. Whether you like social media or not, people use it to communicate how they wish to. You couldn't do that on a Pilot. Most didn't have any way at all to network. Even the Handspring with the cell module (I had a handspring, not t
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*OK... so that was the most convoluted process I can imagine and did require manual PHP scripting with a folding keyboard and a whole lot of external workflow, but I was able to do it with a device that I could haul around in my backpack for two years and use in a sala looking out on the beach and ocean...
Maybe the Blackberry was an improvement
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Probably true for smartwatches - battery life being the main technology issue that needs to be resolved. Once batteries are better (or power consumption is lower), you'll be able to pack more processing power and radios into a watch form factor and eliminate the need to carry a phone. Or, for those of us who don't like wearing jewelry, we can carry Zoolander size phones. Win win either way.
Fitness bands, on the other hand, are most likely a fad. People are always looking for silver bullets for weight loss a
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Actually I think it makes a lot of sense to have a bunch of bio-sensors on something you can place on your arm. It doesn't have to be on the wrist, it could be a bracer or something. I bought one of the heart monitoring devices, but like you said it, doesn't work that well doesn't mean this will always be the case though.
If someone could make a non-invasive heart meter, glucose meter, or lipid profile meter it would sell quite a lot.
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That's where biology becomes problematic. From a convenience perspective, it'd be great to have a small pack of sensors somewhere that let you monitor vitals, especially for people who are sick. The problem is, there's no one place we can put a range of sensors and have them all be accurate enough to be useful. The body is a distributed system and different parts let you measure some things and not others.
Theranos ran into this problem recently by attempting to perform a wide array of tests on a single drop
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That is a very big possibility. Personally, I think the problem with smart watches and fitness devices is that while they are useful, most people don't actually need the features they offer. For a smartwatch to be useful, you already have to have a phone along side it. But everything you can do on your smart watch can already be done by your phones. That is, apart from the heart rate and movement tracking, which I'm sure only a small number of people are actually interested in.
Everybody used to carry arou
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Everybody used to carry around paper agendas and briefcases with their important files. Now you can completely replace that entire thing with your smartphone.
Curiously the Android phone I bought has no buit-in text editor facilities at all, there is Google Drive, but you need to be connected to the network. Lame.
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...the Android phone I bought has no buit-in text editor facilities at all ... Lame...
Fortunately, there are app stores. On my Android phone I have a text editor app called Ted, which meets my needs nicely. There's no reason why a text editor should be be pre-installed on each phone.
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Cross compile nano/vim/emacs.
Open a terminal.
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the original iphone had less features than some of the early 2001 era PDA's. Just the ones it did have were better and as they added features those were better as well.
problem with smartwatches is that you're paying $400 for something that tells you the time like my phone already does.
or saves me one whole second in not having to look at my phone if i'm one of those people who absolutely has to look at every text and email the second it comes in. most people are not idiots like this, so that's that.
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FYI, Pebble 2 that was Kickstarted was $99.
https://www.kickstarter.com/pr... [kickstarter.com]
I unfortunately lost my warranty on mine because Fitbit didn't take over the warranties of Pebble.
As far as the HR monitor, it is useful when running to make sure you are above the fat burning level of heart rate, but don't go into VO2 max territory. It is useful for those of us that don't run on a regular basis, and don't know well enough what pace to run at as it gives a goal and range to shoot for.
Re:Realistic (Score:4, Informative)
Fad?
Palm sold tens of millions of units over more than a decade. They were eventually killed by the smartphone.
The Apple ][ sold 6 million. The Newton somewhat fewer.
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Re:Realistic (Score:5, Interesting)
That's a shame...I enjoy my Pebble. Battery life goes for days, and I can check who is calling/emailing/texting without pulling the phone out. It also works as a great phone finder, and has a decent alarm. I hope Fitbit doesn't kill the brand.
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Newton - ARM based computer in your pocket with a touch sensitized screen
iOS - ARM based computer in your pocket with a touch sensitized screen, that actually does somehting
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I could send faxes from my Newton.
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I could send faxes from my Newton.
But receiving them must have been tricky.
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I think it could actually do that too.
and email.
it could barely internet though, even though there was a modem (I never had it on a proper network, so I don't know how it did with that, and I don't think there was any wifi back then.
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I developed for the Newton. Then I developed for the Palm Pilot. Then I developed for PocketPC. Then I got out of the business when the iPhone came along:)
I did come back to help out a team of scientists who'd just returned from a three year expedition in the tropical rainforest. I'd equipped them with PocketPCs before they left, which was just before the iPhone came out. When they returned they felt like Rip Van Winkle.
You have to build products around the limitations of the technology, and that means t
Re: Realistic (Score:1)
The thing I liked a lot about my Palm was it's highly focused limitations. It has a memopad, a calendar, a contact list, a todo list. They all synched flawlessly to an 'data island' on my PC. Nothing went anywhere else, it was all compartmented, and when I got a new computer I could zip up the whole palm desktop folder with my data and relocate it, OR just install the Palm desktop on the new PC and sync my Palm to move all my data to the new PC.
There were not 100 todo apps to choose from, not 1000 memo apps
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It might not have been as mass market as smart phones but it still sold well enough to sustain a line of devices until 2011. It might even have made the leap to mainstream with smart phone devices powered by Palm's replacement OS, webOS, but HP (who acquired Palm) made a hash of the p
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Wrong. Fitness tracker sales are still increasing, as they have done since they were first introduced.
Pebble had the Style, but not the Tech (Score:1)
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now they get their design patents as well
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are you kidding? the pebbles were ugly as sin and at least the early versions were plagued by display problems that the company tried to sweep under the rug.
Sounds like Pebble missed the boat (Score:2)
That quote says it all (Score:5, Insightful)
He blamed a more cautious outlook from VCs focused on tech as the primary reason for letting 40 of Pebble's staff go.
In what universe is this quote acceptable?
This man appears to believe that businesses get money from VCs and pays money to employees+suppliers. Last I checked, businesses got money from customers. They'd get /loans/ from banks (but that has to be paid back).
The problem with a lot of SV/Tech startups is that the people involved appear to believe that their income comes from VCs. Their business plan is effectively "Get VC Money, Then Sell Company!"
A depressed market would soon separate the wheat from the chaff.
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What are you basing your assumptions on? How do you know what the 1200 employees at Fitbit do? Rolex has almost 3000 employees. Is that too many as well? BMW has over 120,000 employees, how can that be? It doesn't take over 100,000 people to design and sell cars, does it? The US Armed Forces have almost 1.5 million active service men and women. That's WAY too many. It doesn't take over a million people to win wars!
Ignoramus
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> It doesn't take 1200 people to design, sell and market watches.
I'm sure you could run the whole operation alone from your mom's basement.
Re:That quote says it all (Score:4, Informative)
> the President displayed a total misunderstanding of how a business works when he said these businesses needed to "take out loans to expand their payroll"... in the real world people scale for how much they are selling
People scale for how much they project to sell. Hence loans. Very very basic stuff here.
Re:That quote says it all (Score:4, Funny)
The problem with a lot of SV/Tech startups is that the people involved appear to believe that their income comes from VCs. Their business plan is effectively "Get VC Money, Then Sell Company!"
It's hard to tell for sure, but you seem kind of surprised by this. If so, you must be pretty young, since this has been true for almost 20 years now.
Re:That quote says it all (Score:4, Interesting)
Umm, facebook?
the whole thing is a roll of the dice for them. Much like the music scene, you throw money at 50 people, 45 will fail miserably, 4 will come close to even, and 1 will be a rock star and finance all of the 50. It's been that way since the web came out.
The Internet doesn't even things out. By making location irrelevant for delivery reasons, it makes concentration of people/money for other reasons more relevant. So, we can Facebook corner the market for socail. we can have amazon corner the market for selling. Then any VC that bets on one of these has their rockstar and gets very rich. their roll of the roulette wheel paid off not 30-1 but 3000-1
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Shh, you're ruining someone's narrative about how VCs are just big pools of dumb money.
Says it all about Silicon Valley (Score:1)
This man appears to believe that businesses get money from VCs and pays money to employees+suppliers. Last I checked, businesses got money from customers.
In Silicon Valley, VC's are your customers. :-)
Aww... (Score:1)
I really like both of my Pebbles. Don't really want a fitness band, do want a watch.
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Me and you both mate.
Well it's a free world, but don't expect me to watch.
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I gave up on fitbit. I had a charge HR that fell apart, and the warranty replacement fall apart.
They're not particularly cheap. about 130 or so, and the apple watch is on sale now for 199. Yet the apple watch feels 3 or 4x as solid and does 5x the things. I may get one.
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I bought the Time Steel via the Kickstarter after I had cataract surgery and was sick and tired of pulling my iPhone out to see what time it was. My Steel is awesome: alarm clock with vibrating alarm, count-down timer, AND I CAN READ IT WITHOUT MY GLASSES. The Time 2 series: my interest was the larger display
Sue the CEO (Score:4, Insightful)
CEOs justify their huge salaries saying that their decisions have multi-million dollar affects on a company. Well in this case the CEO gave up a 740 million deal and has to settle for a 40 million dollar deal so he lost 700 million for the company. The employees should sue him in a personal capacity for everything's hes got.
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Not sure about Pebble specifically, but CEOs at VC funded companies typically don't have high salaries. Usually the top engineers and salespeople make more than the CEO. The CEO's compensation is delayed in the form of equity, which only turns into cash after an acquisition or other liquidity event. In this case, taking the $740MM would have resulted in a nice payday for the CEO. $40MM probably didn't even get the investors/debtors their money back.
Public company and profitable private company CEOs are almo
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So the people whose decisions can actually make or break a company are not and the folks who got the post because they are buddies with the board and couldnt screw up even if they tried get paid the big bucks. Ah Crony Capitalism. It smells like fresh fields in the morning - full of manure.
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The summary said the deal failed, it didn't say that was down to Pebble's CEO. It may be that Citizen realised Pebble was way overvalued and backed out. Unless you have information from elsewhere of course, I'm only going on what's written here.
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The full story says the CEO declined the offers.
The CEO, Eric Migicovsky refused both offers.
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Lol, I read TFA literally to the sentence before that bit, doh. Well, hopefully Eric Migicovsky will be feeling even dumber than I do.
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At least he's no Jerry Yang!
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You're trying really hard to be overly pedantic. Everyone who isn't suffering from Aspergers knows what was meant by the statement.
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mixed emotions (Score:4, Informative)
I purchased two Pebble watches as part of the original Kickstarter. One failed within a year (we were too distracted at the time to pursue a warranty claim), the other one is still "ticking".
Custom programming my own non-24-hour sleep-wake calendar was a big step for me in finding a cure. It finally put my metabolic reality on equal footing with the world around me, so that I could properly track each on its own terms.
I will always remember my Pebble watch as a life-changing event.
That said, I had doubts about Eric Migicovsky as a venture capitalist right from the beginning. When the original watch was delayed (I've done electronics fabrication before, it's far from easy with so much at stake on a new product) Eric obviously got some advice to keep reality close to the vest, and thus his public comments fell far short of the mark, given the situation. It's actually a flaw in the Kickstarter program that your promised delivery date is locked in stone prior to discovering you've got a landslide on your hands. (How to manage around that, I've never quite figured out. Kickstarter mainly appeals to flighty dreamers—too much honesty could seriously damp the lemming effect.) For my money, Eric failed the test of knowing when and where to draw the line on taking good advice. Any damn fool can advise you to keep your PR powder dry. Actual VC talent is required to know when to blow these damn fools off and venture out into the dangerous territory of actual honesty, while your users still care.
As for the watch itself, I'm still actually using my Pebble watch, for a single reason. Cure now in hand, in bottle form, I continue to wear my watch because its vibrate alarm is harder for me to ignore or forget than any other watch/phone I've had before, so I really do take my sustained-release melatonin at exactly the right time of day, each and every day, without fail.
I turned off BT completely after Fitness App Runkeeper Secretly Tracks Users At All Times, Sends Data to Advertisers [slashdot.org] because at this level of vigilance investment, extra battery life on both sides was more important than e-mail notification (and I hate pulling out my phone just to check a quick message).
Sad.
Can you tell us what you did? (Score:2)
Can you give a brief description of what you did to solve your sleep-wake cycle?
I'm very interested in this sort of thing, as it borders on some of my areas of research.
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By the power of arcane magic I can reveal that he used it to schedule his medication.
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It's actually a flaw in the Kickstarter program that your promised delivery date is locked in stone prior to discovering you've got a landslide on your hands. (How to manage around that, I've never quite figured out. Kickstarter mainly appeals to flighty dreamers—too much honesty could seriously damp the lemming effect.)
In KSs that I have gone in on, it was done by having the rewards in "waves". Wave 1 is the basic reward shipping on Jan 1 with 1000 offered. Wave 2 is the basic reward shipping on Feb 1 with 1000 offered. Wave 3 ships on Mar 1, etc. They can always add more "waves" as more people sign up and they can always ship early if they can manage it. People that have backed can manage to change their pledge to an earlier wave if they keep and eye out for vacancies as people change pledges or drop out. Of course, you
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Pebble Time 2 is still available for pre-order https://www.pebble.com/new [pebble.com] . Seems this might be FUD by fitbit or trying to lower the price of buying pebble out.
Sad, as a pebble owner (Score:3)
My Pebble Time Steel - other than the giant bezel - is my ideal smartwatch. Great battery life, intuitive controls, looks nice, price was right, battery life means I don't have to charge it daily (sometimes as little as once a week, with a lot of notifications). I thought that Pebble Time 2 would solve my main gripe. But with the buyout, I'm probably going to cancel my order. Why buy into something that's going to be dead from a development perspective before I get it?
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I'm upset by this news as well, but considering the other stories about the bottom falling out of the smart-watch market, I'm not surprised.
I backed the Pebble Time KS and I've worn it daily since I got it. I even wear it at night after the release of Pebble Health for the sleep tracking. I love it. I love the screen (Even though it's only 64-colors, it can be read in bright sun and complete darkness with the backlight). I love that it's waterproof (I've had it in pools and the ocean). I love that with my n
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now the company is being bought by a company that likes to kill its purchases.
I'm wondering what (if any) their obligations are towards existing backers of the PT2 if they're buying out Pebble...
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I doubt the deal would close before the PT2 is supposed to ship (Last week), so I don't think they (Fitbit) have any obligation. However Pebble should still fulfill their KS backers' orders. But there's no guarantee with KS orders, so they may just refund orders. I'm hoping not though. I still want the watch.
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There's no guarantee, indeed, but a company can still be in trouble if it's found they were deceptive or mis-used funds. In this case though they also promised refunds to anyone who asks before shipping, so I guess we'll see.
There's a lot of hate on the Pebble KS right now, with people ranting about how they "ruined Xmas", which IMHO is pretty extreme and overall quite pathetic. I'd say even without the acquisition or other issues, expecting a KS to ship out fully by an exact date is pretty wishful thinking
Is this a hoax? (Score:2)
A rumor at this point. (Score:2)
No one has confirmed this, I wouldn't be surprised if it is FUD from Fitbit to hurt Pebble sales. There is no real reason for pebble to sell at this point in time.