Fascinating inside scoop by WPCentral. According to them, there were very advanced talks between Microsoft and Pebble to come to a close partnership between the two companies. Microsoft built a fully functional Pebble application for Windows Phone with complete integration, offered to bundle Pebble devices with Windows Phone sales through Microsoft stores and carriers, and a whole lot more. All this was set to be announced at BUILD 2014.
However, it did not come to pass.
There is just one problem: Pebble founder and CEO Eric Migicovsky.
Despite Microsoft’s attempts to win over Pebble, Migicovsky is reportedly not a fan of the company nor their mobile operating system. The young entrepreneur reportedly nixed any partnership.
Growing up in a world where Google and Apple have dominated the mobile scene, this perception that Microsoft is old and out of touch is seemingly more frequent these days. Particularly with those under 30 (see Snapchat’s Evan Spiegel for a similar attitude). Even Microsoft CEO Satya Nadella was unable to persuade him personally.
If I were to take an uneducated stab at why Pebble didn’t go through with this, I think we need to look no further than Apple. Apple has its watch coming, and that alone would be incentive enough for Apple to start making the life of other smartwatch makers who want to be compatible with iOS very difficult. Now imagine if Pebble, to boot, had a close partnership with Microsoft, including preferential treatment for Windows Phone? Apple is not exactly know for not being incredibly petty.
I think Pebble made the wise choice here.
What do you do when 90% of your sales are bundles with the 3rd most important mobile OS devices and Independent sales make up a fraction of your sales?
Think it through. Apple makes it hard to play, Android folks won’t play with it because it’s bundled by MS with windows phones, which even though there aren’t a whole ton of sales there, they’ll make up the majority of the sales for pebble watches.
MS makes a play for exclusivity, or they pull the partnership and stop selling pebbles (because they’ve learned enough to be able to compete against pebble in the space).
How do you respond? What’s your fiduciary duty to the investors _let_ you do?
Remember, Embrace, Extend, Extinguish?
If you don’t let them Embrace, then it’s harder for them to carry through with the rest of the plan.
This was absolutely the correct move on behalf of the Pebble CEO.
Except of course, non of that has happened to FitBit …
Does Evan Spiegel realize Microsoft and Apple are about the same age?
Maybe they just didn’t feel the extra work to support Windows Phone would provide a positive return on investment, even with MS’s promotion. I’m not sure Apple sees MS as a threat in the phone market. The press likes to write a lot about Windows Phone, which makes it seem a lot more important than it really is. It’s just not relevant; simple as that – and Pebble knows it.
And that’s my 2 cents.
A really interesting article. MS has *got* to get mindshare back and the only way to do that (yes, in my armchair quarterbacking opinion) is to stop treating Windows like a magic key that lets them root through everybody’s wallet. Those days are over. Over. Over. Over. Done. Finis. Geendet. Fertig.
Sticking their customers on Windows XP, unless they were willing to shell out hundreds of dollars for Vista or 7, was a bone-headed mistake. Jobs realized it was far more important to have customers on ones platform (and the more up-to-date the better) than to charge them for it. The money isn’t in the platform, but in the ecosystem it creates. MS was just too d-mned slow and too entrenched, too addicted to formerly easy money, to risk a tired business model. Now they’re reaping what they’ve sowed. Rather than keeping their customer base up to date, they stuck them on tired platforms. They though they could force everyone to upgrade but that didn’t work out — the mobile world left them behind. The end-result is that MS came to be associated with an OS that was over a decade old. No wonder they look like a bad case of inertia (whether deserved or not).
MS is going to give Windows 10 away for “free”, conditions attached. That has to stop. They need to get into the 21rst century.
Well… let the flaming begin…
No flaming, but I do feel obligated to point out that Apple did not start giving OS X away for free until after Jobs’ death.. Granted they charged a lot less than Microsoft as of Snow Leopard (Leopard was the last version of OS X to cost tripple digits) but they weren’t giving it away until Mavericks. iOS is a different story, though for a little while, iPod Touch users did have to pay for major upgrades whereas iPhone users got them for free. That changed, I believe, as of iOS 3.0 though my memory might be wrong there.
You’re right. I was mistaken in thinking it was Jobs.
“On October 22, 2013, Apple offered free upgrades for life on its operating system and business software.[51] In April, 2014 Apple announced that prerelease versions of OS X would be available to anyone with an Apple ID at no charge.[52] 10.9.1 was released on December 19, 2013. 10.9.2 was released on February 25, 2014. 10.9.3 was released May 15, 2014.[53] 10.9.4 after that was released on June 30th, 2014. The latest update for Mavericks, 10.9.5, was released on September 17th, 2014.”
Interesting. I had no idea they’d explicitly stated it would be for life. Not really surprising though.
Except they are doing exactly that. Both for Windows (Win10 upgrade free for one whole friggin’ year) and Office (ported to other platforms, downloadable from the stores). And currently they are pulling out much more interesting stuff than, say, Apple? (who is still living on Jobs’ trail, and that will not last forever. And sorry, they are NOT that cool anymore unless you refuse to see it, or have an hipster-type brain).
As for the article, it seems quite interesting and accurate until its conclusion. I doubt Pebble – with a not-so-distinguished product – will resist the wave of Apple slaves buying their upcoming watches – not for doing anything useful, mind you, only to show the new gadget to their friends. 😉
Yeah, that’s armchairing it for you. The Microsoft Balmer inherited was drunk with success. It made a serious amount of money from two sources Windows and Office.
How do you give away a product that your company makes billions on? Where does that loss of revenue come from? The plan from microsoft after windows XP was to have releases every two years. So the price can be low for each one, and people will update frequently. But then longhorn… and Vista…
The author of the article is sure to graze on Microsoft meadow and tries to play the same old ‘Microsoft hatred’ card.
I hope it will prove to be a right move by Migicovsky to avoid that sinking monster.
I’m in my 50s and have _strongly_ felt that Microsoft has been passé for over a decade. Actually make that … well I’ve always felt that way.
At best, Windows is the 8th or 9th best OS out there. It didn’t become dominant due to how good it was but to something very close to racketeering if not outright racketeering.
If I added mobile OSs to the list Windows desktop and Windows mobile would be further down the list.
Note that I base my view on multiple statistical computations of security, dependability, up time, ease of use, fewest steps to perform a simple process, fewest steps to perform a complicated process.
By process I mean end result. If one OS takes 10 steps and another takes 4 to do the same thing, it is marked down by 6 points.
Then there is Microsoft’s business practices which I referred to earlier. If you have _any_ ethics at all you do your best to stay away from Microsoft.
I routinely use over a dozen different desktop OSs each week (all versions of Linux distributions or version of Windows count as one each and so on). I started working with PCs in 1981.
What OS I use depends on what OS is best for that function. All are network together so that files are available to all of them.
They pay me to work with Microsoft Products in my job. But when they aren’t paying me … well I have zero MS products at home.
Well, at least you’re honest about your biases…
Sure… if your sole criteria for quality is “trendiness.” Of course, that’s merely rhetorical since you outright confirmed in the previous paragraph.
It’s funny the way that claims like that only ever come from people whose experience with computers is limited to being end users, making them unaware that there’s more to an OS than the just the desktop interface.
And it’s especially funny to read that claim coming from a notorious iFanboy: in terms of serious server/enterprise functionality, OS X is to Windows as Fisher Price’s “baby’s first plastic toy hammer” is to a professional-grade nailgun.
The most blatant example has to be the way be Apple actually has the gall to charge nearly $80 USD for a “remote desktop” solution that’s really just warmed-over open source code (VNC, but missing major functionality like reverse-connections)… while Microsoft includes the vastly-superior RDP at no charge in all of their desktop/server OSes (except the Home editions, which still at least include the RDP client).
“Statistical computations,” really now? And I’m sure you’ll be posting those here any day now (…waiting…).
So what you’re saying is that No True Scotsma… I mean “ethhical person” would use Microsoft’s products? Riiiiiiight.
Oh wow, really?!?!? Cool story, bro! Your commitment to knee-jerk anti-populism is truly inspiring!!!
No Thom, as much as you’d like to believe it, the world does not revolve around Apple. Amazingly, people make business decisions without considering Apple every day.
Yeah. In this case, considering Microsoft’s past track record would be enough to keep you from wanting to be one of their “partners.”
True, but you’ve got to be completely and utterly stupid to make a device dependent on mobile phones without considering what Apple is doing.
MS was clearly trying to ride on Pebble’s wave there. MS didn’t have a smartwatch, even their smartphones are not a big deal, and they might’ve thought the popularity of Pebble would increase their phone sales. Well, bummer, this is what you get when the only thing you can show is how lost you are. MS needs to get their sh*t together, they just don’t seem to be in a good place right now (and for a while now). And about the “I think we need to look no further than Apple…” line, come on now, why do we have to include Apple in every conversation? Yes, some people like Apple, you might like Apple, yes, they have a watch – which is nothing like the Pebble btw, their bad -, so what? If they know better, Pebble will stay away from Apple as well.
Popularity of Pebble? You have the wrong idea about who on whose wave would be riding here…
And Stephen Elop so wanted to be CEO of Pebble too.
Wish there was a standard protocol for these kind of devices, then it wouldn’t matter what these big corps did or didn’t like. bah.
I tend to disagree with the prevailing trend here. This was a decision by someone who wanted to be trendy rather than someone with a business mind.
Pebble needed to develop an app to utilise their own hardware, and in exchange would have more marketing and units out in the wild then they could have hoped to do alone!
Ok, let’s take this as number.
Last year micosoft sold about 30 million lumia units. Let’s compare that to the Total pebbles sold numbering about 0.5 million. Pebble would need to be bundled with just 1.5% of those would double their userbase. And we all know, userbase = users = developers = apps = money
Getting this kind of headstart on apple and android wear would have left Pebble in a far stronger position to weather any storm of competition that comes.
IMO both companies are in denial about their actual context/position in the mobile markets: Pebble is a dead company walking, they just don’t know it yet. And Microsoft is still refuses to accept the actual context/position of WP in the mobile OS segment.
I think either company ended up doing the “right” thing (not partnering), but for the wrong reasons.
Edited 2015-02-27 20:33 UTC
Before you continue; support your claim first please.
I have no experience with their devices but if I were to buy a smartwatch it would be a pebble or fitbit. I don’t get those smartphones on a band.
It’s really not that outlandish of an assumption that a small, fly by night company, is not likely to survive now that apple and google have made clear commitments to enter, and develop, the smart watch market.
Pebble still have to rely on kickstarter drives to fund their latest device. That does not inspire IMO much confidence in their longevity prospects.
Kickstarter seems like a great marketing tool. You also get a good indication of how many watches you should produce. It mainly targets owners of the original Pebble who might want to upgrade.
I don’t think he needed kickstarter.
[edit]
On the dead company: fitbit and Pebble is the way to go. Those smartphones on a band will fail. So until MS, Apple, Facebook, Samsung etc. produce those kind of devices Pebble only needs to fear fitbit like companies.
[/edit]
Edited 2015-03-01 06:54 UTC
IMO Kickstarter is a very limited marketing tool; the intended audience is limited mainly to tech enthusiasts who are willing to risk their money. That’s a very very tiny portion of the smart watch market overall.
That they (Pebble) have to rely on kickstarter, still, to finance their newest product could send mixed signals. Either they did not make enough money from their current products to finance the company further, or they are not willing to risk their own money on their own development and want others to foot it.
Amateur hour is over the minute a market is commoditized or about to be, like smart watches.
Edited 2015-03-02 04:12 UTC
From what I have seen of smartwatches they are all interesting prototypes that should have stayed in the lab.
So I see pebble as the main player and the other other ones as mee-too’s.
Considering the history and how *every* company that partnered this way with Microsoft ended shafted, I would sat the Pebble CEO made the right choice.
Like Apple. They did Really badly out of partnering with Microsoft..
Apple was the exception, Microsoft needed to keep them alive to dodge the monopoly charges
… if you have a good memory you will not partner with Microsoft. They will stick a knife in your back sooner or later.