
Pebble CEO explains why he sold to Fitbit - steven
https://backchannel.com/the-real-story-behind-pebbles-demise-303802a7afaa#.7uvcar7gj
======
fudged71
Pebble crowdfunded as an alternative to venture capital. Their huge success on
the platform was an inspiration to so many other hardware startups that it
sparked an entire generation of products (in my opinion). Kudos to that.

I still wear my original Pebble. It's reliable with very long battery life,
and is one of the very few wearables that works well while wearing gloves.

~~~
padobson
I think the problem with crowdfunding (and early adopters in general) is that
product hype can be a product unto itself. That's part of the value that
Kickstarter provides, but it disappears when a product hits the wider market,
and all that's left is the actual value of the product.

Wearables will gain more traction when wearing them actually enhances their
value (fitness trackers that measure your pulse, VR headsets glasses that
change what you see).

Smart watches, unfortunately, were just redundant. The entire idea of a smart
device is that it has everything you need on one device. Carrying two smart
devices makes no sense, and the phone got here first.

~~~
themihai
>> Carrying two smart devices makes no sense, and the phone got here first.

I've always believed the watch will replace the phone. It's easier to carry
than a phone. I would replace my iphone with a smartwatch in a heartbeat but
unfortunately the current models are too limited: no 4g/lte, poor battery, no
carplay, not easy to read data(i.e emails), too bulky etc. The main issue is
that the watch is just not good enough for now but eventually it will get a
big chunk of the marketshare.

~~~
bmm6o
Has anyone figured out how to integrate a camera into a watch? Nobody would
replace a phone with a device without a camera.

~~~
jon-wood
I totally would almost all the time. I use my phone's camera maybe once or
twice a week, otherwise its just a useless extra, and I know the occasions on
which I'm going to want a device with a camera so I could easily plan for them
and take my phone (or a real camera) with me.

~~~
taejo
I have a nice camera with good lenses, filters, etc., but I nevertheless
probably take more photos with my phone: it's the camera that's always in my
pocket, any time I see something interesting.

~~~
JustSomeNobody
Same.

Also, I take way more pics of the kids with my phone than my dSLR simply
because I never know what they'll do next and I always have my phone with me.

------
zem
> Apple’s emphasis on fashion and Pebble’s on productivity and third-party
> innovation were costly detours—the smartwatch market is rooted in health and
> fitness.

that's depressing :( i was hoping that they had just misexecuted, and someone
else would step in and fill the niche of "e-ink watch with long battery life
that is geared towards displaying things your phone sends it"; i have no use
for fitness tracking and biometrics, and pebble's featureset and reasonably
open ecosystem was ideal for me.

the saddest thing is that even buying used pebbles on ebay won't help me much
with their servers going offline :(

~~~
marssaxman
"even buying used pebbles on ebay won't help me much with their servers going
offline"

...and this is the failure of the IoT in a nutshell.

~~~
edejong
So true. When I first read about IoT, about a decade ago, I thought of it as a
miniaturized and _decentralized_ , semi-autonomous client and server systems
design.

The fundamental problem of the current take on IoT is a misunderstanding of
the internet part. Our systems should be decentralized and find routes to
_nearby_ systems that are available. So, to be an active actor within the
arena of pico-net, local net, internet. Currently, most IoT systems mostly
connect to some central, unprotected server hosted in <insert-cheap-labor-
country-youve-never-heard-of>.

~~~
RyJones
May I introduce you to AllJoyn [0]? Proximal (broadcast domain) IoT. It's
baked in to Windows 10, LiFX bulbs, a bunch of TVs... [1] It's being folded
into OCF now, but the open source will live on. Don't need a gateway, don't
need a server.

[0] [https://alljoyn.org](https://alljoyn.org)

[1] [https://allseenalliance.org/certification/certified-
products...](https://allseenalliance.org/certification/certified-products-
directory)

ETA: Disclosure: worked for Qualcomm/AllSeen Alliance for years on AllJoyn

~~~
boondaburrah
I'm hoping someone will make the AllJoyn protocol accessible for a weekend
project. As it is right now I can't make heads or tails of what I need to
onboard a simple LIFX bulb. It seems like I have to spin up a whole Java
enterprise-ish project when all I want to do is send some packets to it's
virtual access point with my wifi creds in them.

Do you know if there's any documentation on the low-level protocol that
doesn't involve using the big SDK? I'd love to just write a python (or
similar) script to do this grunt work.

~~~
RyJones
Morten Nielsen [0] has written quite a few small packages around AllJoyn on
Windows [1]. There is a JavaScript binding [2] which also might help. There
was a Node binding [3] but it doesn't look like it's under active development.
ASA stopped shipping SDKs some time ago because the juice just wasn't worth
the squeeze.

[0] [https://github.com/dotMorten](https://github.com/dotMorten)

[1]
[https://github.com/dotMorten/AllJoynLightingController](https://github.com/dotMorten/AllJoynLightingController)
for example

[2] [https://cgit.allseenalliance.org/core/alljoyn-
js.git/summary](https://cgit.allseenalliance.org/core/alljoyn-js.git/summary)

[3]
[https://www.npmjs.com/package/alljoyn](https://www.npmjs.com/package/alljoyn)

------
dstaley
There's only three things I want in a smartwatch:

1\. Resemble an actual, reasonably sized watch.

2\. Display notifications from my phone along with their actions (such as
marking an email as "Done" in Inbox, or liking a Tweet).

3\. Allow me to respond with my voice for notifications that support quick
replies.

The Pebble Time Round was _great_ at _all three_ , and (as far as I know) was
the only watch to have the features that I wanted in a form factor that
resembled a reasonably-sized watch. The only other alternatives currently are
Android Wear watches, all of which don't look like the kinds of watches I like
to wear (they're thick, with large bezels and superfluous embellishments).

If I knew for sure that a Pebble Time Round would continue to be useable for
the next six months, I'd buy one in a heartbeat, but the uncertainty makes me
hesitant to spend the $100+ on one.

~~~
Reason077
Fitness, Apple Pay, Siri.

These are the killer apps for smart watches. Pretty much everything else the
Apple Watch does is a waste of time, just replicating functionality that is
easier and better experienced on your phone.

The Apple Watch (and others) are trying to solve a bunch of other non-problems
that don't exist for 99% of the real world.

They would be better products if they had _less_ features.

~~~
pluma
> Fitness

I don't want or need a fitness tracker. Judging by other comments I'm not the
only one.

> Apple Pay

...is not supported in most places where I live, so it's a gimmick at best.

> Siri

Maybe I'm weird but I don't find voice input acceptable in social situations
and don't want to rely on speech recognition when it comes to technical terms
or mixed language input (I'm not in the US).

For me "a controlled subset of your smartphone's notifications on your wrist"
is _the_ killer app. Everything else is a gimmick.

~~~
gvurrdon
The Apple watch recently obtained a means to reply to messages by means of
handwriting recognition. This works rather well in practice and I find I'm
able to send short replies quickly and easily in situations where speaking to
the watch would be inappropriate (e.g. on a bus).

I find Siri very useful indeed for one thing in particular, which is to set
reminders. This has been a very useful feature of smartwatches, and I might
even consider it a "killer app". Other than that, sending some messages from
the watch and setting timers I don't use Siri.

I would agree about the utility of watch notifications. For example, if my
Nest camera spots a human figure on my property I get a photograph of them
turn up as a notification on my watch, which is awesome.

The fitness tracking is of little interest and not really very useful given my
main sporting activities involve sparring - blocking punches is not an
activity which suits wearing an expensive watch.

~~~
izacus
I find it funny that reminders are go-to thing that everyone talks about when
mentioning Siri.

Can it do ANYTHING else well? Especially if you're outside USA?

~~~
gvurrdon
I don't know and I'm not particularly bothered to find out since I don't want
to use it for anything other than reminders, timers and the occasional text
message.

When I was using Android Wear and Google Now that was all I wanted; the rest
of Google Now was far too much of a nuisance. If Pebble could have handled
reminders as easily I'd have been using that instead.

------
edejong
> Netherlands city of Delft, known more for pottery than technology

Perhaps this is true, but hopefully not any longer among HN readers:

\- Antonie van Leeuwenhoek: world first microbiologist, huge improvements in
the microscope

\- Martinus Beijerinck: discoverer of the virus

\- Produces the Nuna, which won the world solar challenge in Australia 5 times

~~~
Maarten88
Yes, as a Delft alumni, that remark hurt a little.

The Porceleyne Fles, the only remaining Delft blue manufacturer, is now a
touristy place, employing probably less than 50 people.

The TU is one of the better universities in the Netherlands, employing almost
5000 people, and around 16.000 students.

~~~
sehr
If it's worth anything, this southern Californian thinks very highly of TU
Delft. Their product design course on edX was a great little introduction to
the field, and the only MOOC I've actually seen the whole way through!

------
teekert
Am the only one around here that doesn't care one single bit about the fitness
aspects?

My Pebble Time Steel broke (actually just the band), just before these
announcements and I got a refund (spendable only at the company I bought the
Pebble, but that's ok.) But I miss it! I miss the the notifications, I had
gotten completely used to putting my Phone somewhere, anywhere withing BT
range for the duration of the day. 99% of notifications do not require
immediate attention (I also strictly filter what was allowed through to the
watch) but some do and the ability to see that on your wrist is gold to me.

For now, sadly, there is no replacement that even comes close. I really want
an always one screen and at least 5 days of battery life.

~~~
pluma
I absolutely agree. I backed Pebble the first and second time they were on
Kickstarter but passed on round three because my Pebble Time Steel was still
going strong and all the new features seemed to be focused on the fitness
aspects to the point the "one more thing" reveal turned out to be a small
headless device that is only really useful to runners.

Pebble was everything I wanted from a smartwatch:

* a water-resistant Android-compatible wrist-mounted bluetooth watch

* that shows me real-time notifications from my smartphone (but lets me filter notifications to kill the noise)

* that allows me to pause/resume smartphone audio

* that has an always-on display I can read in broad daylight

* and that can go a number of days without charging

Now that Pebble is gone, I'm regretting not having bought the Pebble 2 because
I'm worried there's nothing I can replace my Pebble Time Steel with when the
time comes.

I don't need nor want a fitness tracker -- I'm only interested in sleep
tracking and I prefer charging my watch while I sleep. A heartrate monitor
would be fun but just a gimmick.

Ironically I never had any use for wrist watches before I bought my first
Pebble and now I feel naked without it. But I don't want to spend hundreds of
dollars for something I really just want to tell me the time and buzz and show
me notifications without having to pull my smartphone out.

~~~
teekert
I guess you and me are part of a very small group of users, sadly.

------
paulcole
"seller of over two million smartwatches"..."Pebble was losing money, with no
profit in sight"

I honestly don't understand this line of thinking. Why not, you know, sell
something for more than it costs?

~~~
devy
Economy of scale. As a comparison, Fitbit has sold more than 38 million
devices worldwide since 2010[1].

[1]
[https://www.statista.com/topics/2595/fitbit/](https://www.statista.com/topics/2595/fitbit/)

~~~
philfrasty
Do you have any insight on what their return rate is? Judging by the Amazon
reviews it must be somewhere (far!) north of 50%.

------
outworlder
I own a Pebble Time Steel. It is wonderful. People really underestimate the
impact battery life has. I get annoyed when I finally have to take it out to
charge (about once a week). Heck, right now it's at 10% and I don't really
care. It didn't even tell me yet when it's expected to run out.

The screen may not be as gorgeous as a phone screen, but it is on all the
time.

It's also very developer friendly. Heck, you can even create watchfaces in
Javascript.

Before the acquisition, I would not trade it for the first generation Apple
Watch. Maybe the second one, just maybe, if the community does not find a way
to keep the current Pebble devices running.

~~~
IanCal
> I own a Pebble Time Steel. It is wonderful. People really underestimate the
> impact battery life has. I get annoyed when I finally have to take it out to
> charge (about once a week). Heck, right now it's at 10% and I don't really
> care. It didn't even tell me yet when it's expected to run out.

And I don't know if it still has this feature, but the OS had something that
when it was really close to dying it'd switch off all the bluetooth and
smarter bits and display a basic watchface, so it'd keep working _as a watch_
for a few more days. That was awesome.

> It's also very developer friendly. Heck, you can even create watchfaces in
> Javascript.

Something that really attracted me to pebble was just how easily I could make
a simple app and get it loaded on my watch.

------
rebelde
> [He considered] bringing the company down to 10 people and just seeing what
> would be next.

Other than the fact that he would need to fire everybody, what is wrong with
reducing costs to make it profitable like this? The problem seems like there
wasn't enough profit to support a staff of 120 people. I can't imagine the VCs
would object. They already lost their money.

~~~
pbiggar
There's a bunch of problems here. For a start, laying off the team is probably
the worst thing a startup founder wants to do - he likely wants to protect
them and so sending them as a unit to FitBit is better. But if we was to go
down to 10 people, then if he sent the rest to FitBit they'd be competing
against the current team! So he's given the choice of the company succeeding
or the employees finding a new home with little disruption.

Secondly, the cap table is probably fucked. It's hard to go down to a 10
person company without fixing the cap table. It's probably something like VCs
own 55%, founders 25%, employees 20%. So for it to "behave" like a 10 person
company, you want to recap it and make it more like a Series A company
(investors 35%, founders 50%, remaining employees 15%). If you don't it's
shitty for the founders and remaining employees.

If you do, it's shitty for investors. Who wants stock in a Series A company at
Series C prices? They wouldn't even have product market fit. And given they
have the option to get their money back instead, I'd wager they'd all vote to
sell.

A final reason is that the culture of a company changes as it grows. They'll
currently have a "big company" mentality. They'd have to switch to a "small
startup" mentality, which might be tough: they might not even have "small
startup" employees left (it's not uncommon to see early employees leave when
the company gets too big for them to enjoy).

Whereas if he starts a new company, he'll find it really easy to raise money,
he can probably pull away the employees that he needs from FitBit, and he'll
own almost all of it.

~~~
uiri
I agree with you, finding jobs for ~50 of the 120 employees is better than
firing 110 of them.

The investors aren't getting their money back no matter what the cap table
looks like now. Pebble went bankrupt. The founders are also walking away with
nothing. No money from selling the company but also no debt - that's the
benefit of limited liability.

~~~
pbiggar
I thought the company sold assets to FitBit. I saw a $40m number floating
around. While that might be golden handcuffs for employees, I would typically
expect to see the investors take some cash out of this.

If there was $40m, it's likely the founder got _something_, even if it's just
200k. There has to be financial incentive for him not to burn it to the
ground, and the VCs probably don't want to get a founder-unfriendly reputation
over a "small" chunk of cash.

~~~
uiri
Pebble's debts exceed $40M. The asset sale was for $34~40M. They're in
bankruptcy proceedings:
[http://www.proofofclaims.com/PebbleTech/documents/](http://www.proofofclaims.com/PebbleTech/documents/)

The financial and legal incentive is not going to jail and not being
personally liable for any of the company's debts.

------
vvanders
>... was the company’s willingness to keep Pebble’s developers and users in
the game.

You mean like dropping warranty support and a vague statement about cloud
based features degrading over an undisclosed amount of time?

~~~
Raphmedia
As a Fitbit user I'm so very happy to hear that Pebble's developers are going
to Fitbit! Fitbit's software ecosystem is bad. I have many Fitbits (Fitbites?)
and I've stopped using them because the app and website are "meh" at best.

~~~
saghm
> I have many Fitbits (Fitbites?) and I've stopped using them because the app
> and website are "meh" at best.

I'm curious about this. If the app and website are bad enough to stop using
them, why do you have multiple? I would have expected the issues would be
noticeable with just the first device.

~~~
Raphmedia
The products themselves work great. They track everything with great accuracy.
... The problem came when it was time to analyse that data. I was tempted to
use their developer tools to extract my data as .csv and build my own app but
simply gave up using them.

------
rilut
But Citizen had offered them a better deal, didn't they? $740m rather than
$40m. [1]

[1] [https://techcrunch.com/2016/11/30/fitbit-
pebble/](https://techcrunch.com/2016/11/30/fitbit-pebble/)

~~~
broahmed
You know what they say about hindsight and perfect vision.

Sounds like Eric thought the company could have survived. I give him props for
sticking with it as long as possible.

~~~
lonelyw0lf
He must be feeling like killing himself now! wow! $740M!!! and instead now he
heads back to YC as yet another partner. I'd really be curious to see YCs cap
table :) Sam must have that locked up somewhere :)

------
FussyZeus
The Smartwatch as a concept is a good one, however the current offerings have
one of two problems:

Pebble's problem is the lack of features, and specific to users of iOS like
myself, relative instability and weirdness when it comes to important things
like notifications. The monochrome screen is also less attractive though IMO
bearable.

Apple Watch's problem is battery life. It's absolutely unattractive to me to
have yet another thing I need to charge once a day. It wins on pretty much
everything else but such a low battery life is crippling to this sort of
device.

I feel like between the two you have a rough approximation of the laptop
offerings of the early 80's. Yes, they did exist and some people used them,
but by and large they were terrible for the functions they were built for. I
have a feeling in not even that much time, we'll have proper smart watches
with good integration across platforms that will have a screen like Apple's
and the life of a Pebble, but for now, laying out $250 for what's basically a
bleeding edge prototype is unattractive to the mainstream consumer.

Edit: Question for HN: Would you all consider a Fitbit to be a smartwatch? I
mean it's a watch-esque device that does more intelligent things than just a
regular watch but I feel like that's more of a wearable monitoring device.

~~~
lfuller
I've found that the battery life issue has been largely overblown, especially
with the Apple Watch Series 2. On most days (all features enabled, moderate
app usage, no GPS usage) I still have between 65% - 75% of battery life
remaining.

Even if the battery life wasn't that good, is it really that hard to take your
watch off before bed and set it on a magnetic charger? I've worn watches my
whole life and have never slept with them on.

~~~
derekp7
I take it you aren't interested in sleep tracking? I find it helpful to know
how much "deep" sleep I've gotten -- and it does tend to correlate with how I
feel the next day.

But as long as it lasts for more than a day, and if it charges fast enough,
you could always charge it in the car on the way to work. Or charge it while
in morning while in the shower.

~~~
rconti
I've never tried using my Apple Watch 2 for sleep tracking as it's usually
only around 50-60% at the end of the day, and it's 'best' to charge at night.
Granted, I'm already wearing a Fitbit Charge HR and have a Hello Sense sleep
tracker as well.

I've also noticed on the odd occasion where i sleep with my apple watch on,
the screen lights up too frequently as i roll over. The fitbit does that too,
but isn't as bright.

Anyway, if you can barely/hopefully survive 2 days with it, it means you
really need to charge it daily. Again, something I'd rather do while sleeping
than at my desk.

------
lowglow
Hey word on the street is Fitbit didn't take many of the hardware people from
Pebble. (Not sure why?) But if you're a hardware person from pebble reading
this then reach out to me, I'd love to take you out for coffee and have a
chat! :)

~~~
mratzloff
Perhaps they should; Fitbit's hardware is terrible. I bought two Fitbit
watches, one after the other, and after they both fell apart within 6 months I
forswore them altogether. Their software is bad, too, but the hardware was the
killer.

~~~
staticelf
And I bought my fitbit when it came out and it still looks brand new. I wear
it everyday. What sucks is not the hardware, it's their software.

Thousands of people have had syncing issues for a long time, seems like
they've fixed most of it now but I guess there is reason to believe it could
happen again.

~~~
mratzloff
The glue on the Charge and Charge HR kept breaking down and the thing would
gradually peel away from the plastic until it literally fell apart.

------
bambax
I have to ask: were 160, then 120 people really necessary?

Judging by their Kickstarters' successes, Pebble had made "something people
want", and they had made it repeatedly. Couldn't they have waited out the bad
times with a lighter team, while tweaking the products and remaining
profitable or at least just above zero?

120 people sounds enormous to me -- esp. given that all manufacturing was
outsourced...?

~~~
VLM
Interfacing with retailer buyers is labor intensive and they were trying to
sell pebbles everywhere. So you have like one employee-equivalent (across
multiple departments) per major client (amazon, target, walmart) and maybe
half an employee per minor retailer and you can easily use maybe 30 employees
just keeping the retailers entertained. Even if you only sell one unit to
walmart it still costs you like one employee-equivalent just to keep the
monster fed with paperwork and contracts.

Also hardware has very expensive customer support costs, lets say they had 1e6
sales and fifty customer support (to keep the math easy) and lets say a
typical customer support dude burns an hour per ticket total (including
training and everything back office) and works 2000 hours per year, thats
100000 or 1e5 customer service interactions per year. Thats only a 10% support
rate. Of course the annual rate was probably much lower than 10%, and they
probably had a lot less than 50 customer service employees, but you can see
how selling consumer hardware can be incredibly expensive. Its very difficult
to have a million units out there with fewer than say five people baby sitting
them.

There's also the SV stereotype that it takes about Y folks in SV to do what 1
person in Chicago would do, where the value of Y is extremely debatable but
certainly larger than 1. The nicest way to put it is if it takes six months to
soak in the culture and we intend to double in size and sales every six months
then need a team twice as big as it "needs" to be today to be ready in six
months, and of course six months from now the team will have doubled again to
keep up with the onramp to the next doubling 12 months out, etc. Of course
when the growth rate doesn't achieve or flatlines or goes negative for a
couple quarters then you have like ten people to do a one person job, so all
sad company stories end this way, with why do you have 10M units worth of
employees with only 1M sales, no wonder, blah blah.

~~~
bambax
Thank you for these, they're very enlightening.

What was the point of having a strong retail distribution, though, esp. given
the nature of the product and its target market? If it's on Amazon why would
it need to be available at Target or Walmart? Also, when you're small, keeping
stock with big retailers can be very costly, not just in headcount but in
cash.

If this was indeed part of their strategy it's weird.

------
bunderbunder
I've never owned or used a Pebble, but for me it's poignant that this
coincides with my decision to stop wearing a Withings Activite and dusted off
my trusty old Seiko 5.

This shift was primarily motivated by two factors:

    
    
      1. I lost interest in the activity tracking features.
      2. Even worrying about the battery once every 6 months was too much.
    

And supplemented by a third, which is that the fancy watch wasn't very
readable and lacked a second hand. That made it less capable at the main thing
I use it for: keeping track of the time.

I looked hard at a Pebble at one point before deciding that, since my phone is
almost always in my pocket or on the table in front of me, getting it into
position for viewing information would take only nominally more effort and
probably gets me to a place where I can act on whatever information the device
is telling me much more efficiently. Also, having a non-user-replaceable
battery means that the device will only live for so long, and I'm really
trying to limit my consumption of disposable technology.

I think that, for now, my most optimistic case for smartwatches is that
they're at about the same phase as handheld computing was 15 or so years ago.
The technology is really interesting, but there needs to be more technology
development and ironing out of subtle details before the idea is quite ready
to take over the consumer market.

------
pluma
> Apple’s emphasis on fashion and Pebble’s on productivity and third-party
> innovation were costly detours—the smartwatch market is rooted in health and
> fitness.

I'm not sure this is accurate. Pebble sold relatively well. They just couldn't
get more customers beyond a certain point. It's a niche market.

Fitness trackers become obsolete quickly. They tend to be relatively cheap and
there are a lot of sensors and software that can be iterated on to justify
selling newer versions of the same product every year to the same people.

When the Pebble Steel came out, I gave my original Pebble away. The only
reason I switched was that I liked the design of the new one better, the
original still worked just as well as the new one.

When the Pebble Time Steel came out, I switched again and again the one I had
at the time worked fine. The Pebble Time Steel had some new features but
mostly it did much of the same.

I passed when the Pebble 2 came out because I couldn't justify paying again
for a replacement to something that still worked as good as on the first day.
The Pebble 2 brought some fitness features but was otherwise no different from
what I already had.

Fitness trackers have planned obsolescence. The tech becomes outdated very
quickly and the conditions in which they are used lend themselves to natural
wear and tear. Utilitarian smartwatches on the other hand are expected to
last.

Pebble sold me three smartwatches in almost as many years. They actually
marketed four[0] more in that time. They oversaturated the market and grossly
overestimated the demand.

Their first Kickstarter generated $10MM, their second in early 2015 generated
$20MM, their third generated $12MM. Considering they were falling in the red
in 2015 and their 2016 campaign was doubling down on the fitness aspect and
bombed in comparison to 2015, I don't buy the narrative that fitness tracking
would have been a better focus.

[0]: To recap: Pebble, Pebble Steel, Pebble Time, Pebble Time Steel, Pebble
Time Round, Pebble 2, Time 2 and Pebble Core (which is not a smartwatch). The
2016 Kickstarter also saw the edition of silver/gold editions of the Pebble
Round but those seem otherwise identical to the original.

~~~
Mvandenbergh
Yeah I don't know if it's right to say that the market is "rooted" in that
segment it seems like it's easier to make money there for a variety of
reasons.

Something like 80% of the market is special purpose wearables like Fitbits vs.
20% smart watches like Pebble and Apple.

One of the only companies in the segment that had good results in 2016 was
Garmin which focuses on activity watches.

The fitness and activity tracker segment has several advantages:

-there's an obvious benefit to being wearable, so they're not competing directly with smartphones.

-they're selling into a rapidly growing market for "lifestyle" accessories.

-precisely that obsolescence that you mentioned means they can keep selling to existing customers.

-many people who use them get addicted to the gamification aspect of fitness tracking and will immediately replace broken items.

-sports equipment is expected to wear out in a way that premium watches are not, so watches that break after a year or two do not leave as much of a negative perception with customers.

------
jessaustin
ISTM the many screen-on-wrist testimonials on this page confirm a longstanding
prediction of mine: the "smartphone" is not the ultimate device form that our
children will be using as adults. Instead, every personal item will become
part of a personal constellation of devices. Phones will gradually disappear
as better (i.e. ubiquitous, low-power, and basically free) wireless networks
emerge, and our eyeglasses will talk to our hats which will talk to our shoes
which will talk to our wrist devices...

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hyperpallium
> _Apple’s emphasis on fashion and Pebble’s on productivity and third-party
> innovation were costly detours—the smartwatch market is rooted in health and
> fitness._

Over the last few years, I noticed store catalogs giving much space to fitbit,
and little to pebble (or apple watch).

Perhaps this is a crude exoscope, for viewing outside the bubble/RDF? Like
Buffett observing people still actually using American Express, outside Wall
Street's gloom.

Those catalogs now include iPhone 5s and Samsung Galaxy S5 alongside the
flagships, suggesting "good enough" and flagships have overshot...

Where will the tech, talent and investment go, if smart phones and watches are
good enough, and VR/AR is a wash?

~~~
saghm
> Where will the tech, talent and investment go, if smart phones and watches
> are good enough, and VR/AR is a wash?

Cloud services, I guess? They seem to be doing well enough to last until the
next "big thing" comes along.

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sanj
_Only 30, Migicovsky has plenty of time for future glories. And plenty of
leftover watches to keep that time._

Ouch!

------
basseq
TLDR: Because it was either that or shutting down (either completely, or with
such a massive downsize that it would have been effectively the same thing).

I'd be interested to know what he _did_ get out of the deal. Sold for "south
of $40M" and with the statement, "He’s not leaving Pebble as a wealthy man."

~~~
blunte
Wealthy relative to startups, or relative to the real world?

~~~
cbo100
relative to how much debt he had to pay off?

$40MM wouldn't be much buffer for a product that was about to go into
manufacturing and distribution I would have thought?

I.e. all the costs of design, development and planning are sunk. And they
didn't get to the stage of selling them to recoup any of that.

~~~
the_duke
My guess is most/all of that money went into paying off suppliers and debt.

------
logicallee
can someone summarize this for me? (I imagine the obvious actual answer to the
headline is, "I'm passionate about having a place to live, eating, travelling
and otherwise enjoying the results of 300 years of capitalism and
industrialization.")

\---

EDIT: Thanks for the downvote. Can I have the summary, please?

~~~
soared
From someone else's comment:

> TLDR: Because it was either that or shutting down (either completely, or
> with such a massive downsize that it would have been effectively the same
> thing).

~~~
logicallee
thanks.

