How Fitbit Could Stage a Comeback With Its New Watch and Premium Service—Data Sheet
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When Fitbit CEO James Park and his team finally decided that the pioneering maker of activity tracking wristbands should move up market to smartwatches, their first product was a bit of a dud. The 2017 Fitbit Ionic cost $300, almost as much as an Apple Watch at the time, and had a harsh, science fiction look that didn’t jibe with enough Fitbit fans.
But Park’s second effort, the Fitbit Versa released last year, was a much smarter smartwatch. Costing only $200, the rounder watch retained the most appealing features of higher-end models and looked better on slimmer wrists, like those of–say–most women. It was an immediate hit.
Unfortunately, Fitbit learned the wrong lessons from the Versa and this spring came out with an even cheaper model, the Versa Lite, starting at $160. Lacking features people wanted, including control buttons on the side, it’s been a loser.
So going back to the drawing board, Fitbit this week unveiled the Versa 2. And, instead of removing features and cutting the price, Park added features and maintained the same $200 price. The biggie is adding Amazon’s Alexa voice-controlled digital assistant. That lets Fitbit finally catch up to Apple Watch’s Siri functionality. And at a time when mobile payments are really starting to take off, Fitbit added its mobile pay app to the standard edition of the Versa 2 (it had only been included on pricier, limited edition models in the past).
Park also took a page out of Tim Cook’s services playbook with the new Fitbit premium service that will offer health and fitness analysis for $10 a month to users of any Fitbit device. It’s a slick addition to Fitbit’s already popular app that could garner a lot of users in a hurry, since even customers who never upgrade their hardware could sign on.
Both the service and the new watch look like winners, especially given Fitbit’s recent struggles. That could surprise Wall Street, which has all but written off Fitbit, now considered the cautionary tale for consumer hardware companies seeking to raise money. Fitbit went public in 2015 at $20 a share, or some 85% above its current price. At about $3 a share, and taking into account cash on its balance sheet of $2.19 per share according to Yahoo Finance, an acquirer could pick up the company for peanuts. That would be a sad fate for an innovative company that pretty much invented the category.
On Twitter: @ampressman
Re-do. After getting lumped in with rivals, Apple is trying to separate itself from the pack on privacy protection once again. Addressing the controversy over contractors listening to customers' Siri recordings, the company apologized and said it would require an explicit opt-in from customers before saving or using their Siri recordings. And employees, not contractors, would listen to any such recordings, Apple said in a short statement. Separately, Apple also will sell iPhones online and at its own retail stores for the first time in India starting in a few months, after the government relaxed import restrictions.
Not exactly Taylor Swift material. Speaking of things that should have been thrown away, turns out Amazon execs were compiling a record of statements by opponents to the company's sweetheart tax deal to build a new HQ in New York. The so-called burn book (actually a Microsoft Word file) helped convince the company to drop the plan, the Wall Street Journal reveals in an interesting behind-the-scenes report of what went wrong.
Please make it stop. Employee troubles at Google are back in the news AGAIN, after a former company lawyer wrote a post about her relationship with Alphabet chief legal officer David Drummond. Jennifer Blakely wrote that Drummond violated workplace relationship rules and refused to pay child support. Google didn't comment. Seeking to end a different controversy, Google's YouTube said it's starting a new site and mobile app just for kids. The app will segment videos by age. "We know that what is great content for a 4-year-old may not be great content for a 10-year-old," the company noted. After listening to one too many Raffi songs in my time, I can't disagree.
Volatility is as volatility does. For no apparent reason, prices of cryptocurrencies plunged on Wednesday. Bitcoin, for example, fell 6% and dropped below the symbolic $10,000 level for the first time in more than a month.
Repackaged. Speaking of plunging prices, shares of cloud app and storage provider Box dropped 9% in pre-market trading on Thursday even after the company released quarterly results better than analysts expected. Box shares were already down 18% this year.
Saving my pennies. It's a big time of year for new product announcements in tech. Here are a few that caught my eye besides that new Fitbit watch: Garmin introduced the fenix 6X Pro Solar watch, which, as the name implies, recharges from the sun. Canon announced two new digital cameras, the DSLR 90D and the mirrorless M6 Mark II. And Sony went all mirrorless with its new cameras, the A6600 and A6100.
FOOD FOR THOUGHT
About a year ago, Dell Technologies was in the process of assimilating its partially-owned software unit, VMware. But VMware CEO Pat Gelsinger had other ideas and convinced Michael Dell to let his company remain somewhat segregated from the larger Dell ecosystem. After all, VMware has to run on all kinds of hardware, including machines sold by Dell rivals. VMware's stock price hasn't done much since–it's down 3% this year–but Gelsinger is sticking to his guns in an interview with ZDNet.
"How much time do I spend worrying about surface mount technology and injection moulding–and this is a dominant issue inside Dell. Now if I bring those two companies together, executive staff meetings are dominated by supply chain issues," he said. "I don't care–I care, but it's not the core of my business, so I'll say every aspect has reinforced a major innovative enterprise software company that has independence, but also great value for interrelationship and partnership with a world class-scale hardware partner."
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BEFORE YOU GO
Talk about self-help, the cybersecurity firm Avast teamed with French police to take control of a server being used by crooks to install digital currency mining malware on victimized PCs. But they didn't stop there. They then used the server to reverse the process and remotely delete the malware from nearly 1 million computers. Easy peasy lemon squeezy.