Days after Apple Watch's $50 price cut, competitor Pebble lays off 25% of staff
Affordable smartwatch maker and wearable device pioneer Pebble announced on Wednesday that it is laying off 25 percent of its staff this week, citing difficulty raising capital in Silicon Valley.
Pebble CEO Eric Migicovsky said in an interview with Tech Insider that Pebble will reduce its workforce by 40 employees, as it is planning a "careful" approach to the next year. He also revealed that the company raised $26 million over the last eight months.
The announcement comes just two days after Apple announced it has cut the entry price of its own wearable, the Apple Watch, to $299. Both the 38- and 42-millimeter entry-level Sport models are now $50 cheaper than their launch prices.
The price reduction also puts the Apple Watch closer to Pebble's territory, as the company has generally targeted users looking for more affordable wearables. The company's most expensive model is the Pebble Time Steel, starting at $249.99, while its popular "Classic" model is just $99.99.
Migicovsky claimed last November that the launch of the Apple Watch in 2015 had helped to raise awareness for wearable devices and actually resulted in an increase of Pebble sales.
Prior to Apple's entry, the wearable devices market was small. Estimates pegged total 2014 smartwatch sales at just 6.8 million units, with an average selling price of $189.
Citing competitive reasons, Apple has declined to reveal specific sales figures for the Apple Watch.
Pebble CEO Eric Migicovsky said in an interview with Tech Insider that Pebble will reduce its workforce by 40 employees, as it is planning a "careful" approach to the next year. He also revealed that the company raised $26 million over the last eight months.
The announcement comes just two days after Apple announced it has cut the entry price of its own wearable, the Apple Watch, to $299. Both the 38- and 42-millimeter entry-level Sport models are now $50 cheaper than their launch prices.
The price reduction also puts the Apple Watch closer to Pebble's territory, as the company has generally targeted users looking for more affordable wearables. The company's most expensive model is the Pebble Time Steel, starting at $249.99, while its popular "Classic" model is just $99.99.
Migicovsky claimed last November that the launch of the Apple Watch in 2015 had helped to raise awareness for wearable devices and actually resulted in an increase of Pebble sales.
Prior to Apple's entry, the wearable devices market was small. Estimates pegged total 2014 smartwatch sales at just 6.8 million units, with an average selling price of $189.
Citing competitive reasons, Apple has declined to reveal specific sales figures for the Apple Watch.
Comments
Pebble watches look like $10 pieces in convenient stores, all garbages.
(Not.)
That being said, size and battery life constraints are far more limiting.
Apple has far more engineering and technical expertise in manufacturing such a device than anyone else in the industry. And the S series CPU is the key. No one else will be able to compete over the long term. Especially when Apple moves the CPU onto TSMC's state of the art manufacturing processes. No one else will be able to compete with TSMC's 16 nm FinFet built with the Integrated fan out process. It would seem like a logical conclusion that Apple will release the S2 built on the process. The capabilities of such a watch will be much greater than the current Apple Watch.
Pebble, Fitbit, Tag Heuer and like won't be able to compete. Intel's current mobile CPUs are not competitive not to mention a diminutive CPU for a smartwatch.
Even Samsung is going to have trouble over the long term and they make the best smartwatch outside of Apple.
Losing jobs is always painful, but logic would have helped to see this coming. If Apple is taking nearly all of the profits in mobile and making things difficult for companies like Google and Samsung, there was little Pebble could do to compete in smartwatches.
It's a tough sell at $179-199 with the Watch at $299 because it has no touch interface, poor quality display and it's missing or lacking in some of the big features of the Watch like payments and fitness.
They'd probably be better off if a traditional digital watch manufacturer bought them out and put some investment into refining the Pebble Time Round. A team of 120 employees with a few tens of millions of dollars of investment is going to find it hard going up against Apple making over $1b every quarter from their watch. Swatch, Casio and Timex don't have much in the way of smartwatches, Swatch's one looks ridiculous:
They even use the Swiss-made label on it like that's supposed to convince people to buy that monstrosity. It has touch input, payments and some sports tracking though. If they bought out Pebble, put the touch input on it and other features, put their marketing behind it, Pebble would survive a lot longer than them going it alone. Timex is probably a better fit for their style. I think they'd be better under the framework of a bigger brand so that they can lower costs of manufacturing and get their marketing behind them. Without that, the sales will just keep falling and their profits won't sustain their staff levels. Timex has over 5000 employees so could easily support this operation, Pebble would just need to contact someone who deals with mergers e.g:
http://www.timexgroup.com/profile/executive-leadership/ryan-roth.html
https://www.linkedin.com/in/ryan-roth-153bb37
But the pebble can last a full working week on one charge
i'd like to see anyone with an apple watch last half that long
just because they compete with apple
that doesn't mean they suck
they were after a different kind of user
ive owned both, and the pleasure of not having to charge the damn thing every day was pretty good