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Google redeems Fitbit from Nightmare

  Euforin has long passed. (Image: Brendan McDermid / Reuters)

Euphoria is long gone. (Photo: Brendan McDermid / Reuters)

The parent company Alphabet has made a billion bid for the harmful manufacturer of wearables. Is there a competition between giants – between Google and Apple?

Christof Leisinger, New York

What if a company has good business ideas, but that implementation verrennt? – She either goes bankrupt or she is taken over. With Fitbit it comes to the lighter variant. In fact, the Google search engine giant confirmed the rumors that had been circulating for a while and said it would spend over $ 2 billion on the California manufacturer of fitness trackers and "smart watches."

Crash after first success [19659008] This is a nightmare for Fitbits Management and the company's shareholders. Almost five years ago, a fulminant IPO and initially substantially rising prices had emerged. At that time, Fitbit wanted an 85% share in the market for the development and distribution of so-called fitness bracelets. This refers to modern, attractively designed bracelets that hide sensors that can capture the physical activities of the people wearing them and evaluate them intelligently. With such products, Fitbit was able to increase its sales by up to 200% and even make its first profit. It should continue, after all, it is believed to have an advantage in the development of suitable software in a clearly growing market. [1] In January 2016, Fitbit then presented a wristwatch at the technology fair in the American gaming paradise Las Vegas, which has similar functions to the bracelets. This immediately raised doubts about the company's management strategy. Skeptics already considered it grandiose mania to want to compete with economically and technologically extremely potent competitors like Apple or Samsung. In fact, the stock price fell that day, and since then the stock market was down. A disaster for all investors, at least the initial subscribers are now at a loss of more than 60% – even though the Fitbit share price has risen by up to 17% this Friday due to Google's offer.

Agent was not used properly

Operationally, it did not work smoothly. Fitbit had great resources to develop new products after the IPO. But they were not used properly. From then on, the company has steadily lost market share due to increased competition, sales have decreased and ultimately burned money – a hopeless situation. In fact, the pressure comes from two sides. So Fitbit can't compete in the lucrative market for computer watches with the seemingly thriving Apple products. Demand would be there. Cupertino, the technology giant that competes with Fitbit, has increased sales of smart watches, advanced headphones and other handheld electronic devices with standard functionality by 40% just in the past financial year. Among the cheaper fitness bracelets, Chinese rivals like Xiaomi and Huawei have strong competition for the industry pioneer.

With the support of Google, everything will now be different and above all better for everyone involved. Fitbit believes it will be more innovative than ever, based on the search engine giant's huge resources and platform. Newly developed products and services are expected to hit the market quickly, says co-founder and CEO James Park, and promises to prevent damaging hints that the data collected by Fitbit devices would not be used to place Google ads. Google derived the Wear OS operating system, which focuses on modern watches, from the Android system. If the group strives for a similar dominant position as in the smartphone sector, competition between the giants would be imminent. So far, however, the "Android camp" has not been able to keep up with Apple's competitors.

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