Fitbit has confirmed its acquisition of Pebble which includes software, intellectual property like watch’s operating system, watch apps, and cloud services and many of the smartwatch pioneer’s engineers but not its hardware. This deal has been made in order to increase Fitbit’s push in healthcare industry. Pebble’s software can help Fitbit in laying the groundwork for a new app store.
Pebble has been struggling financially despite raising $40m from three Kick-starter campaigns which includes crowdfunding site’s biggest investment. Pebble would be discontinuing its smartwatch range and will refund Kick-starter backers who have not received the products as promised. The company might have failed to achieve mainstream appeal but its operating system and software development tools gained a good following among app makers.
Pebble is the only independent company after Apple’s Watch and Google’s Android Wear to have an app platform for wearable. The company’s technology will also be complimenting Fitbit’s in-house R&D on new hardware and sensors. Fitbit has also warned last month that its sales will not be very strong as was expected because of supply storages and drop in demand in Asia.
Smartwatch market is already sinking due to the fact they are expensive and they don’t provide any other functions apart from those which are already in cell phone. Pebble’s existing watches will continue to function normally but there will be no warranty available on the existing models. Pebble has already sold around two million devices since its launch in 2012. It is said that Fitbit has made this acquisition in order to compete with Apple watch.
The shares of Fitbit are also going down and only time will tell whether the acquisition made by the company will boost up its shares or not. Many people are in shock over Pebble’s closure as it was the company which had started making smartwatches and had made some good watches.
Let us hope this acquisition proves useful for both the companies in the near future.