Google BUY Fitbit. A rival for Apple Watch?

Updated: Nov 27, 2019

The path of Fitbit has come to an end. Founded in 2007 in San Francisco, California, it launched its first bracelet in the summer of 2010. Now, more than nine years later, the company will become part of Google's long list of acquisitions. Confirmation of your sale is not exactly a surprise since a month ago we saw how you hired an investment bank to explore your sale.

Judging by the press release published by Google, its purpose is oriented towards the creation of an official smartwatch, so it is clear that this movement is of great interest to its main competitor, the Apple Watch.

Google and the platform that does not take off

It's no secret that Wear OS, Google's smartwatch platform, is a market failure. There is no significant presence of the Google platform in the market share.

The devices under the Wear OS platform are grouped in the Others category, a kind of tailor's drawer where all kinds of brands that manufacture smartwatches are found. Here he leads the Apple Watch, followed by Samsung with its own Tizen and Fitbit platform. However, the section corresponding to the latter has not stopped falling to below 10% in the last measurement since the debut of its smartwatches.

Market share is not a variable that explains the performance of a company. You can have a fraction of it and have influence whenever it is the high-end, as with the iPhone. But this is not the case with both Fitbit and Wear OS. The Google platform has not finished taking off. The Mountain View company has tried to repeat the strategy used in the smartphone market (free software pushed by other manufacturers) but has not obtained traction in the wearable market.

Over the years, Google has made progress with its allies in space with Wear OS and Google Fit [your health app], but we see an opportunity to invest more in Wear OS as well as introduce wearable devices Made by Google into the market. Fitbit has been a true pioneer in the industry and has created devices that engage [the user], experiences and a live user community. Working together with the Fitbit team of experts and bringing the best artificial intelligence, software, and hardware, we can help spur innovation in wearables and build products that benefit even more people around the world.

This is how Rick Osterloh expressed himself in the press release confirming the acquisition of Fitbit. Google hopes to turn around the situation of its wearable platform by building its own smartwatch with the help of the Fitbit team. The latter tried unsuccessfully to open the market with four different watches, the Ionic, Blaze, Versa and Versa 2 (in addition to an intermediate model called Versa Lite). There is no reason to think that Google will be able to reverse its proposal now.

Apple Watch still without a competitor

At this point, the unquestionable success of the Apple Watch reveals that the smartwatch market is much more complex than the smartphone. Apple's watch leads the category by containing the right doses of design, technology, software, and services. All this translated into a satisfactory user experience at reasonable prices. Competing with the Apple Watch requires combining all these elements appropriately to be able to stand up.

At the moment, there is no reason to think that the rest of the competitors have managed to keep up in any of these aspects. In the field of design, where fashion seen from the point of view of being accepted by a significant number of people, the Apple Watch has managed to be seen as a compliment and not as an aseptic electronic device. Its collections of aluminum, steel, ceramics and now titanium, as well as collaborations with Nike and Hermès, together with the abundance of types of straps, cover numerous customization possibilities. There is no similar proposal from the competition.

As for technology, the picture is bleak. The Qualcomm Snapdragon 3100 mounted by the most advanced watches is still "outdated" in terms of speed and battery management. The company is rumored to prepare a more capable successor, the Snapdragon 3300 with 12nm architecture. But we are still facing low-end mobile-based chip processors, which face Apple's 64-bit SoC created and optimized specifically for the Apple Watch.

Without high technology, software and services become a slow and unsatisfactory experience for the user, no matter how much Osterloh qualifies as "the best". As for the price, Apple has already divided its watch into two categories: an entry for 199 USD served by the Apple Watch Series 3 and another where is the Series 5 from 399 USD and up to 1,399 USD of the ceramic collection. With this pricing strategy, Fitbit was left without a space in which to compete that was not that of smart bracelets. A product line that is at the mercy of generic bracelets of just 35 USD.

For all these reasons, it is not clear what Fitbit provides differential to Google in these fields, given its poor performance in the market. Some point to its user community and the abundance of health data, which the company has been quick to say they will not use to feed Google ads. Whatever the company's plans, races are not won by slowing down than your main competitor. Apple Watch's advantage over the rest is growing.


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