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Fitbit fights to stay relevant with new entry into smartwatch market

Fitbit has announced a new smartwatch called the Ionic. The $300 smartwatch will include third-party apps, an NFC chip for contactless payments, and GPS tracking.

Fitbit's new Ionic smartwatch was announced on Monday.

Image: Fitbit

The competitive market for smartwatches has a new entry with Fitbit announcing on Monday its latest device, the Fitbit Ionic, which is the first smartwatch that Fitbit has developed that will run third-party applications.

Many official definitions of smartwatches, including those from the IDC, only include smartwatches that run third-party applications. The IDC does measure sales and market share of all wearable devices, including Fitbit's health and fitness trackers. Fitbit lost its first place market share among wearable devices in the first quarter of 2017, with only 3 million shipments. Xiaomi and Apple tied for first place during that same period, with 3.6 million devices shipped.

SEE: Fitbit's new Ionic smartwatch and accessories (TechRepublic)

Starting today, the Ionic is available for presale online, with shipment in 3-4 weeks, and it will be available in retail stores in October 2017. Priced at $299.95, it's the most expensive device that Fitbit has offered to date. The Fitbit Blaze, which debuted in January 2016, is priced at $229.95. The Blaze, although it does not offer third-party applications, offered many other smartwatch features including notifications.

The Ionic is water-resistant up to 50 meters, and it has health and fitness features such as personal coaching, third-party apps, activity tracking, and sleep tracking. It includes a new relative SpO2 sensor that will estimate blood oxygen levels and could eventually track sleep apnea. It is also the first Fitbit device to offer contactless payments with Fitbit Pay and on-board music with 2.5 GB of storage.

How the Ionic smartwatch will impact Fitbit

"I think for the time being that this will sustain the company a bit more. There is a $300 price point, and it's the most expensive Fitbit device to date," said Ramon Llamas, research manager for IDC's wearables team. "I see the first wave of demand coming from Fitbit users and others in the install base, and people who know and appreciate what the Fitbit experience is all about."

"What I like about what Fitbit's doing is they're not positioning this as another smartwatch, but as a health and fitness smartwatch. Fitbit is sticking by its DNA, sticking by what it knows incredibly well. The entire feature set is built around health and fitness. It's not trying to be a device for communication and news. It's about tracking your health and giving you all the data and moving on from there," Llamas said.

In addition, Fitbit is trying to bring a few new experiences to its customers such as Fitbit Pay. It's not technically a health and fitness feature, but it is a valuable tool for someone looking for a cold drink at Starbucks after a workout, Llamas said.

SEE: Executive's guide to mobile security (free ebook)

Fitbit is also opening the door to becoming more multi-purpose by allowing third-party applications. Llamas said, "It stands to reason we will see some other kinds of applications that are possibly not health and fitness oriented. In addition to music and getting coffee and shopping, at some point do you get news, stock ticker reports, score updates, and things of that nature?"

Llamas said the early announcement, prior to the Ionic's appearance in retail stores, will give developers time to develop apps and increase customer interest.

"Fitbit is trying to build rolling thunder as they move closer and closer to launch, so that between today, August 28th, and then, October, they'll build interest among the 50 million Fitbit users worldwide. They'll build rolling thunder with app developers, they'll build rolling thunder with distributions and channel. There is a lot they can do in the next 5-½ or 6 weeks before October rolls around," Llamas said.

Fitbit Pay contactless payment

Fitbit Pay will allow users to add American Express cards, as well as Mastercard and Visa credit and debit cards from banks in more than 10 markets worldwide, including ANZ, Banco Santander, Bank of America, Capital One, HSBC, KBC Bank Ireland, OCBC Bank, Royal Bank of Canada, UOB, and US Bank. More countries and banks will be added soon, according to a Fitbit press release.

FitBit Pay will work similarly to Apple Pay, Android Pay, or Samsung Pay, as long as the user has a card from one of the banks that support the service.

Third-party apps and developer tools

The Ionic will include partner apps at launch, including Pandora, Starbucks, Strava social network, and AccuWeather. By fall 2017, apps from partners such as Adidas, Flipboard, Game Golf, Next, and Surfline will be available.

Fitbit is making Fitbit Studio, its software developer kit, available beginning in September 2017 so that developers can build apps for the Fitbit App Gallery. Fitbit is building upon the Pebble platform to provide developer tools such as fast development on an open platform using JavaScript and Scalable Vector Graphics (SVG). It will offer cross-platform compatibility for Android, iOS, and Windows platforms, and an open platform for enterprise health companies to customize wellness programs for customers. The built-in NFC chip will also provide an opportunity to develop apps for keyless and cardless access to buildings, hotels, sporting venues, and transportation.

Other new products from Fitbit

Today, Fitbit also announced new Fitbit Flyer wireless headphones for $129.95, the Fitbit Aria 2 Wi-Fi smart scale for $129.95, and a guidance and coaching program that delivers customized curriculums based on a customer's Fitbit data and activity level for $7.99 a month. The headphones and scale are available for presale today, and will be available at retail stores in the fall of 2017. The coaching program will be available in the fall of 2017.

Fitbit said in a press release that it is partnering with Adidas to deliver a Fitbit Ionic special edition device and training programs in 2018.

The top 3 takeaways for TechRepublic readers

  1. Fitbit announced on Monday that it is launching the Ionic, the first smartwatch that Fitbit has developed that will run third-party applications.
  2. The Ionic goes on sale on Monday for presale, and it will arrive in retail stores in October 2017.
  3. Fitbit fell to third place among wearables manufacturers in the first quarter of 2017, and the Ionic could make it viable again.

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