Jawbone has launched a wristband that allows Amex payments on tap
awbone is catching up with Apple Watch by enabling its latest wristband to make payments in stores, through a deal with American Express. The launch comes as analysts at market research company NPD forecast that the US activity tracker market will peak next year, as devices such as Fitbit and Jawbone’s UP wristbands are displaced by smartwatches.
A new version of Jawbone’s UP, which will allow wearers to pay using their American Express card by tapping the device against wireless readers across the US, will go on sale this summer. Jawbone’s future rests on how its UP wristbands fare against the likes of Fitbit and Misfit, as well as whether its slim design and long battery life can help to differentiate itself from Apple Watch, which started shipping last month.
Apple Watch also allows wearers to use their American Express accounts as well as Visa and MasterCard credit cards for payments through Apple Pay. Fancy tech
Jawbone’s system, which will initially be supported only by its 199-dollar (Dh731) UP4 band, uses near field communication and secure tokenisation of card details, allowing wearers to pay with a flick of the wrist. “There is a lot of noise in the marketplace about different payment functions and features,” says Leslie Berland, Executive Vice-President of Digital Partnerships and Development at American Express. “We wanted this to be the simplest way to experience commerce...”
Jawbone’s move into payments comes as a new version of its UP wristband with a heartrate reader and other new sensors hit the market last month, four months behind schedule. The company said the delay of the 179-dollar UP3, originally intended to launch before Christmas, was due to problems in achieving the waterproofing needed to enable it to be worn while swimming, a feature that was eventually scrapped.
“We are still light years ahead in technology even though some time has passed,”
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says Travis Bogard, Jawbone’s Vice-President of Product Management and Strategy. “Nobody else has got close to what we are doing there.”
However, projections for the fitness wearables market suggest that the delay could compound pressure on Jawbone. According to NPD, activity tracker ownership will peak at 32 million in 2016. “The smartwatch will clearly begin to take a bite out of the activity tracker market moving forward,” says Eddie Hold, an analyst at NPD. “The fact that the health and fitness apps on smartwatches are a key marketing focus will help draw consumers away from the simpler trackers.”
While Jawbone is focused on the lifestyle uses of its bands, NPD says more sophisticated sports devices with features for athletes such as GPS tracking stand a better chance. Fighting fit?
The UP3’s delays came amid growing concern about the state of Jawbone’s finances, which the company hopes to put behind it with the launch of three new wristbands. In addition, Flextronics, a contract manufacturer, sued Jawbone for $20 million last year, alleging it failed to pay its bills. The case was settled out of court.
Jawbone has been linked with Google and BlackRock in recent months as it looks to raise millions in new funding.
Founded in 1999 as Aliph, making wireless headsets, Jawbone moved into fitness trackers in 2011. But the first UP was plagued by production issues, prompting a recall that held up the device for a year. The UP does not use a backlit display like a smartwatch, making it more compact and enabling its battery to last several days.
The two new top-end models track resting heart rate at the moment the wearer wakes up and will come in a variety of colours and materials. “We think the shift is as big as that from the feature phone to the iPhone,” says Bogard of the UP3. However, it cannot track heart rate during the day, as rivals such as Apple Watch and Fitbit’s Charge HR do.