This afternoon CNET broke the story that Nike has fired between 70 and 80 percent of their staff in the FuelBand department. The majority of these layoffs have been in the engineering sector and the move represents a step away from hardware. Nike’s development of FuelBand hardware products has expired as a result, and there’s a lot of speculation as to why this would be.
The two most likely possibilities? Both Apple and Google are working on wearable hardware that would offer a platform for Nike’s software. This means Nike can still offer the experience that NikeFuel has created without having to support an entire engineering team to stay competitive. That’s huge. Don't forget, just this last September Apple hired the design-mind behind the FuelBand, Ben Shaffer.
Tim Cook, Apple’s CEO, is a known supporter of the FuelBand. He wears one himself. At the All Things D conference in May of 2013, when asked by The Wall Street Journal if the future of technology is wearables, Cook replied immediately with: “I think so. I wear this. It’s a FuelBand.” Obviously Cook doesn’t see Nike as a competitor, instead they’re a collaborator. Apple is a hardware company, Nike is not. And this major move by Nike perhaps shows that they’re getting more comfortable in their roles together.
(image via BloombergBusinessweek)
Notice that Nike hasn’t made any moves with the Nike+ program in this round of firings. So, until we hear differently, our Nike+ kicks will continue to roll out as we need to step up our game. The wristwear, on the other hand, seems to be changing hands.