Fitbit acquires key assets as Pebble closes down, hit by market slump

The world leader in wearable activity trackers, US company Fitbit, has acquired key assets from connected watch pioneer Pebble, which is set to close down with immediate effect.

In a message on its website, Pebble explained that "due to a variety of reasons, [we] are no longer able to operate as an independent company. We have taken the tough decision of closing down the business and stop producing Pebble devices."

In a separate press release, Fitbit stated that it will take on some of Pebble's staff and acquire some of its patents, notably those connected with software, but none of Pebble's devices. Fitbit's founder and boss James Park reckons that this "will help accelerate the expansion of our platform and of our environment."

Pebble was one of the first start-ups to manufacture connected watches, reportedly delivering more than 2 million units since 2012.

Its three Kickstarter campaigns are among the crowdfunding platform's top five projects for amount of capital raised, with the 2015 Pebble Time campaign establishing the overall record, having raised a total of $20.3 million.

Pebble has already stopped accepting or handling orders, including those for its latest Pebble 2 device, whose advance orders still outstanding will be reimbursed. The company said that devices now on the market will continue to function, but warned that "functionality or service quality may decline in the future", and that warranties are no longer valid.

In general, the market for connected watches has been underperforming, despite the high hopes tech analysts pinned on it, and it has struggled to stimulate the general public's interest.

According to estimates by market analyst IDC, worldwide sales of wearable connected devices grew 3.1% in the third quarter, selling 23 million units in total (5.3 million units were sold by Fitbit alone). But 85% of the market still consists of basic devices, such as fitness bracelets, which are growing by just over 10%, while sales for connected watches, led by the Apple Watch, have plummeted by more than 50% in the same period.