Jawbone to quit making consumer wearables, focus on clinical products and services1
The writing was pretty much on the wall for Jawbone after it ended production of the UP fitness trackers, sold off the remaining inventory at a discount, and closed its four support centers in Ireland and the U.S. Last month saw Jawbone's executive of products and chief financial officer leave.
“If you think about what a good consumer electronics company looks like, it’s 30-percent margins, annual release cycles and huge risk. It’s turned into a blockbuster game. But folks in this other area, like Omada and other services, they have a human involved but with a nearly 100-percent contribution margin.
It will be interesting to see whether the likes of Fitbit and Apple, arguably the biggest names in the wearable devices industry, will end up on a similar track in the months ahead. This probably won't mean the end of consumer fitness trackers, but the category clearly lacks the kind of opportunity needed to sustain a growing business.