Pebble Technology Corp. is being sold by pieces to Fitbit Inc. Pebble is a smartwatch setup which is now struggling to maintain their position on the market. Fitbit is one of the most known fitness band makers which is planning on buying software assets from the smartwatch company.
Pebble is now struggling because they are in debt. The fact that Fitbit is buying only some parts of the company doesn’t solve Pebble’s problems because they need more money. Fitbit mentioned that they are not taking on the debt too and that they only need some parts of the company. This means that the company is not sold completely.
Fitbit also said that they need some software engineers that know everything about cloud service, operating system, and watch apps. This is why they are buying software assets from the watch company. The price of the purchase is only $40 million, which is a small price and doesn’t cover Pebble’s debt.
Other parts of Pebble, including server equipment and product inventory, are going to be sold separately. None of the companies confirmed this purchase and this is why nothing is sure yet. Once the purchase is done both companies will have to give an official statement.
This year Pebble has been struggling and they even fired a quarter of their staff. Their profits were not doing great and they did not sell as many products as they hoped they would. This is why they are now in debt and they need to be purchase in order to stay alive. The fact that the company is sold piece by piece means that in the near future there will be no Pebble.
Fitbit didn’t do so well this year, either. Because they focused too much on fitness wearables, they left out smartwatches. This might be one of the reasons for which they are currently buying software assets from Pebble. This year they entered the smartwatch market with a new product named Blaze.
In order to develop better devices, Fitbit needs the help of a company that knows more about this type of produce and Pebble is one of those companies. The fact that Fitbit is buying software assets from Pebble might make Fitbit compete with Apple’s smartwatch.