Pebble cancels Time 2 amid Fitbit acquisition
Fitbit has bought the software assets of smartwatch start-up Pebble, targeting its IP, engineers and testers in a bid to compete with Apple's Watch, according to sources familiar with the matter. Two of the sources said the $40m price tag was less than Pebble’s debt and other obligations, which Fitbit is reportedly not taking on, along with other inventory and equipment which is to be sold off separately. Pebble has struggled along with other fitness wearables including Apple and Fitbit itself. Pebble shipments fell 52% in Q3.
Fitbit is very close to announcing its plan to purchase Pebble, according to a new report from Bloomberg, which describes the rumored deal as “imminent.” The leading maker of fitness trackers has offered jobs to roughly 40 percent of Pebble’s staff, with most of those going to software engineers. Fitbit’s buyout of Pebble will focus on the smartwatch startup’s software assets, like the operating system on Pebble’s existing devices.

But the deal will reportedly not cover any hardware — including both current and future Pebble products. “The rest of Pebble’s assets, including product inventory and server equipment, will be sold off separately” says the report, which is backed by sources said to be familiar with the acquisition.

The Pebble Core.

As a result, the Pebble Time 2 and Pebble Core will be canceled and won’t ever ship to Kickstarter backers and pre-order customers. Refunds will be issued to everyone that supported either product through crowdfunding. The Pebble 2 started shipping weeks ago and is already on store shelves. Like its predecessor, the Pebble Time 2 was meant to deliver a more premium wearable experience. And the Pebble Core would’ve been the company’s first non-watch gadget — a small device with built-in GPS that could also play music from Spotify. Now, neither product will see the light of day. The Kickstarter campaign that was intended to fund all three products raised nearly $13 million.