Smartwatch maker Pebble, one of the first entrants into the space, has laid off 40 employees, or 25 percent of its workforce, the company told Tech Insider yesterday.
Pebble CEO Eric Migicovsky cited a decreasing availability of venture funding as the reason for the layoffs, but its hard not to make the connection to increasing competition in the smartwatch market, namely the launch of the Apple Watch last year. At a recent event, Apple dropped the price of the Watch, suggesting that even they are having trouble moving their smartwatches. A Washington Post analysis of the news paints it as a sign that the smartwatch market may be struggling to live up to the hype it's created for itself.
Interestingly, Migicovsky told Tech Insider that his strategy going forward will involve a renewed focus on the health and fitness aspects of Pebble's wearables, which he says are what users are most interested in.
This is not totally surprising for people who have been paying attention to the company, which launched a health app for its devices in December. In fact, fitness has been part of Pebble's value proposition since its 2012 Kickstarter launch, which was followed almost immediately by an integration with RunKeeper. (Runkeeper was recently acquired by Japanese shoe company ASICS). The company has since integrated with Misfit and Jawbone as well.
In a recent blog post following up on the health app launch (and announcing price cuts to many of Pebble's watches) Pebble community manager Joseph Kristoffer shared that 90 percent of Pebble watch owners with access to the health app had activated it, and two-thirds were using it on a weekly basis.
"The roadmap for Pebble Health only gets rosier," he wrote. "Future updates will include insights for running activities and a dedicated Health section in the Pebble smartphone app, featuring your activity history. We want as many people as possible living more actively and sleeping better with Pebble Health. Making the Time-series watches with Pebble Health more affordable is a big step in that direction."