Jawbone, once worth $3.2B, shuts down
LOS ANGELES — Tech products have gone out of business before, but they usually leave traces for consumer contact.
The fitness tracker and Bluetooth speaker company Jawbone, which is in the process of liquidating, is taking a different tack.
Visitors to its website see a company that looks like all is well, and is promoting products — except that there are no links to buy them. A phone number contact directs callers to a general voice mail box. Customers complain in online review forums of leaving many messages in email and phone form that haven’t been answered.
How Jawbone is handling it “isn’t responsible,” says Gartner analyst Angela McIntyre.
A Jawbone spokesperson had no comment. Last week, tech industry website The Information reported on the liquidation proceedings, saying that co-founder and CEO Hosain Rahman is starting a new company to make health-related hardware and software services.
The demise followed years of reports the San Francisco startup, once valued at $3 billion and the beneficiary of $950 million in venture capital funding, according to Pitchbook, was on shaky ground. Jawbone had been locked in a heated battle with Fitbit for the wearable market, with products that help you count daily steps and track sleep.
But Fitbit has been way ahead. In 2016, Fitbit shipped 22.3 million devices, and McIntyre guesses Jawbone saw “less than 20 per cent of that.” Gartner estimates 34.7 million fitness trackers were sold last year, including from companies like Samsung.
Unlike Jawbone, the makers of past tech fizzles did reach out to their customers.
Pebble Watch, for instance, which stopped making new watches in 2016, and has since seen some of its assets acquired by Fitbit, has a webpage alerting consumers what to do, and how to apply for refunds if they’re Kickstarter backers.
In late 2016 the Lily Camera, a drone that promised simple flight operations and had booked over $30 million in preorders, shut its doors and promised refunds to backers. The Lily website is down, but Lily has a Facebook page with links for filing refunds.
Other recent missteps include Amazon’s Fire phone, which went bust and the Samsung Note 7, which was recalled. Both were by big companies that stayed around, with processes to contact the company, and in Samsung’s case, get a refund or a new phone.
The Information says Jawbone founders’ new firm will take care of customer service. Jawbone has just yet to show any sign of that yet.
Jan Dawson, an analyst with Jackdaw Research, says consumers should think long and hard before buying products, and really research the company.
“Stories about Jawbone having troubles have been out there for the last year and a half,” he says. “The writing has been on the wall if you cared to look.”
Julie Ask, an analyst with Forrester Research, says the wearable market is a tough nut to crack for small companies, and she sees upsides for the established players like Apple and Samsung, who “have the scale to produce and distribute hardware plus they have the services element.”