CNET has reported that Nike is officially abandoning development on all Fuelband hardware, but will continue to support the Nike+ software platform, possibly as part of a strategy to license that technology to other hardware manufacturers.
CNET Reports Nike Will Stop Developing Fuelband
CNET reported Monday that Nike alerted about 70 employees who work on the Fuelband hardware team at its Digital Sports Division of the impending layoffs. The news site quoted a Nike spokesman who confirmed a certain number of layoffs were occuring as part of a regular realignment at the fast-moving division.
The report comes less than six months after Nike launched the Nike+ Fuelband SE, the latest version of the device which tracks a wearers movements for export and analysis on the Nike+ Fuel App. Nike launched the original Fuelband in 2012.
In November, Nike also announced its was opening the Nike+ Fuel Lab in San Francisco to encourage tech companies to develop more NikeFuel apps. Nike plans to partner with 10 companies at the lab this year to bring an integrated product to market by the end of the 12-week program. Nike is also expected to release the API for its Nike+ software platform to third party app developers soon.
Margins on hardware are typically much lower than margins on software, so the change could signal a shift in strategy that acknowledges hardware design is not a core competency at Nike.