Today Pebble has announced that it will cease all hardware production. Their outstanding Kickstarter deliveries will not be fulfilled but refunds will be issued. Warranties on all existing hardware will no longer be honored. However, the existing smartwatch service will continue… for now.
This isn’t unexpected, we ran an article yesterday about the all-but-certain rumors FitBit had acquired Pebble (and what led to that). Today’s news has turned speculation about Pebble 2 and Pebble Core Kickstarter campaigns into reality. You won’t get your hands on that fancy new hardware, but at least backers will have the money returned.
Perhaps the most interesting part of today’s blog post from the founder of Pebble, Eric Migicovsky, is about how this impacts more than a million watches already in the wild. Service will continue but (wait for it) “Pebble functionality or service quality may be reduced in the future.”
It’s not like this is a unique problem. Devices purchased by consumers that are dependent on phoning home to a server to function is a mounting issue. Earlier this year [Elliot Williams] coined this issue “Obsolescence as a Service” which is quite fitting. Anyone who still has a functional first generation iPad has enjoyed reduced quality of service; without available upgrades, you are unable to install most apps. It’s zombie hardware; electrons still flow but there’s no brain activity.
One of the perks associated with FitBit acquiring Pebble is that they have decided to keep those servers running for watches in the field. A cynic might look at the acquisition as FitBit reducing competition in the market — they wouldn’t have let hardware production cease if they were interested in acquiring the user base. At some point, those servers will stop working and the watches won’t be so smart after all. FitBit owns the IP which means they could open source everything needed for the community to build their own server infrastructure. When service quality “reduced in the future” that’s exactly what we want to see happen.
Despite owning five, including the original Pebble, I’ve always been somewhat skeptical about smart watches. Even so, the leaked news that Fitbit is buying Pebble for “a small amount” has me sort of depressed about the state of the wearables market. Because Pebble could have been a contender, although perhaps not for the reason you might guess.
Pebble is a pioneer of the wearables market, and launched its first smartwatch back in 2012, two years before the Apple Watch was announced. But after turning down an offer of $740 million by Citizen back in 2015, and despite cash injections from financing rounds and a recent $12.8 million Kickstarter, the company has struggled financially.
An offer of just $70 million earlier this year by Intel reflected Pebble’s reduced prospects, and the rumoured $30 to $40 million price being paid by Fitbit must be a disappointing outcome for a company that was riding high such a short time ago.
Continue reading “The Demise of Pebble as a Platform”
Reuters has reported that Qualcomm will purchase NXP for $38 Billion in the largest semiconductor deal ever.
This deal was rumored last month in a deal worth about $30 Billion. Qualcomm’s name should be familiar to all Hackaday readers – they have an immense portfolio of mobile processors, automotive chips, and a ton of connectivity solutions for WiFi, Bluetooth, and every other bit of the EM spectrum. NXP should also be familiar for their hundreds of ARM devices, automotive devices, and Freescale’s entire portfolio.
The deal for $38 Billion is just a bit larger than the previous largest semiconductor deal, Avago’s purchase of Broadcom for $37 Billion.
This latest acquisition has followed acquisitions of ARM Holdings by Japan’s Softbank, On and Fairchild, Avago and Broadcom, NXP and Freescale, Microchip and Atmel, Intel and Altera, and a few dozen we’re forgetting right now. The good news is this immense industry consolidation won’t result in a single gigantic chip maker; there will probably be two or three gigantic chip companies in the future. If I may dredge up an observation from a Mergers and Acquisition post from this summer, this trend didn’t go well for Hughes, Fairchild, Convair, Douglas, McDonnell Douglas, North American, Grumman, Northrop, Northrop Grumman, Bell, Cessna, Schweizer or Sikorsky. It went very well for Lockheed, Boeing, and Textron.
Remember when we talked about NXP merging with Freescale to move into the top ten semiconductor companies? Yeah, that was just eighteen months ago and just barely closed before the new year. Now it looks like Qualcomm wants to acquire NXP to the tune of $30 billion.
You’re most likely familiar with Qualcomm as a cellphone silicon company. The acquisition of NXP opens up a lot of additional markets with their portfolio of chips — automotive among them thanks to the Freescale merger. Now you should be asking yourself just how big Qualcomm is already. What’s perhaps most interesting is that, as mostly a wireless chip company, Qualcomm is ranked number three in worldwide semiconductor sales. Adding NXP — a behemoth now in the top ten — adds at least 30% to Qualcomm’s numbers.
And so here we are, one step close to a monolithic chip fab that produces all computing power for the human race. Yippie!
Analog Devices and Linear Technology have announced today they will combine forces to create a semiconductor company worth $30 Billion.
This news follows the very recent acquisition of ARM Holdings by Japan’s SoftBank, and the later mergers, purchases or acquisitions of On and Fairchild, Avago and Broadcom, NXP and Freescale, and Microchip and Atmel, Intel and Altera, and a few more we’re forgetting at the moment.
Both Analog and Linear address similar markets; Analog Devices is best known for amps, interface, and power management ICs. Linear, likewise, isn’t known for ‘fun’ devices, but without their products the ‘fun’ components wouldn’t work. Because the product lines are so complimentary, the resulting company will stand to save $150 Million annually after the deal closes.
Analog and Linear are only the latest in a long line of semiconductor mergers and acquisitions, but it will certainly not be the last. The entire industry is consolidating, and the only way to grow is by teaming up with other companies. This leads the question if there will eventually only be one gigantic semiconductor company in the future. You’ll get different answers to that question from different people. Hughes, Fairchild, Convair, Douglas, McDonnell Douglas, North American, Grumman, Northrop, Northrop Grumman, Bell, Cessna, Schweizer and Sikorsky would say yes. Lockheed Martin and Boeing would say no. It’s the same thing.
$32 billion USD doesn’t buy as much as it used to. Unless you convert it into British Pounds, battered by the UK’s decision to leave the European Union, and make an offer for ARM Holdings. In that case, it will buy you our favorite fabless chip-design company.
The company putting up 32 Really Big Ones is Japan’s SoftBank, a diversified technology conglomerate. SoftBank is most visible as a mobile phone operator in Japan, but their business strategy lately has been latching on to emerging technology and making very good investments. (With the notable exception of purchasing the US’s Sprint Telecom, which they say is turning around.) Recently, they’ve focused on wireless and IoT. And now, they’re going to buy ARM.
We suspect that this won’t mean much for ARM in the long term. SoftBank isn’t a semiconductor firm, they just want a piece of the action. With the Japanese economy relatively stagnant, a strong Yen and a weak Pound, ARM became a bargain. (SoftBank said in a press release that the Brexit didn’t affect their decision, and that they would have bought ARM anyway. Still, you can’t blame them for waiting until after the vote, and the fallout, to make the purchase.) It certainly won’t hurt SoftBank’s robotics, IoT, or AI strategies to have a leading processor design firm in their stable, but we predict business as usual for those of us way downstream in the ARM ecosystem.
Thanks [Jaromir] for the tip!
According to this article in the Guardian, Premier Farnell, the electronics parts distributor who is also a UK manufacturer of the Raspberry Pi, is going to be sold to Dätwyler. Their share price immediately rose 50%, closing at just under the Swiss firm’s offer price.
Farnell itself had been on a binge, according to Wikipedia anyway, buying up electronics distributorships in Poland, India, and the US. In 2009, they bought Cadsoft, the makers of Eagle CAD software. Now they’re being sold to another distributor.
Bloomberg writes this up as being just more consolidation in an already consolidating market. What any of this will mean for the hacker on the street is anyone’s guess, but we’re putting our money on it amounting to nearly nothing. But still, now’s the time to stock up on your genuine UK-owned, made-in-UK Pis before they become Swiss-owned and made who knows where.