Intel is clearly looking at wearable and embedded spaces. This seems like a lot to pay for something that doesn't have the install base of Fitbit, or Fuel.
I can't imagine basis had any tech that Intel couldn't replicate, and this seems like too much for talent acquisition.
Seems cheap for a company with 18B cash in hand and wanting to expand their hardware offerings. They've been pouring tons of money into gesture tracking web cams, x86 clones of Arduino, etc. all sorts of things.
The rest of the company exists to feed the fab. So it doesn't surprise me, the lengths they are going in an effort to get Intel silicon into more devices (and more types of devices), especially after they missed the smartphone wave.
Intel's been in the watch business before [0]. It didn't end well then, it probably won't end well now. Hey, at least they didn't spend $19 billion for a texting app.
FB didn't spend $19B for a texting app. They spent $19B for a huge userbase in parts of the world where FB doesn't have much market share. (And one with considerable network effects leading to significant switching costs.)
I expect there to be some kind of onboarding of the WhatsApp customer base onto FB as smartphones get adopted in those parts of the world.
I know it was more than a texting app. Since this story was about Intel not Facebook I probably shouldn't have thrown that line in. But here's why I did:
I'm sure there are all kinds of arguments, explanations, justifications, rationalizations (call it what you will) for FB's purchase of WhatsApp. But my gut feel is that it's not worth paying 1000x TTM revenues for it. Admittedly a large part of the price was in stock not cash.
Same with Intel's purchase. My gut feel is they shouldn't be buying a watch company. Intel has an abysmal track record with acquisitions. I think it's a sign that they're desperately flailing around. I'd rather see them try to become a world class foundry. They certainly have the technology and expertise, and it's much closer to the CEO's background. I.e. "stick to the knitting".
How does the Basis rank against the other smart watches out there ? I see it's priced higher, $199, where others come in at $100 - $150. The one difference I see is that it can do heart rate monitoring, and a lot of the competition can't (yet).
It's nice to see that they have an API to export your data too.
They focused on gamification and achievements you can unlock ("slept full 8 hours" etc). However it lacks any wireless connectivity, so you need to plug to your computer to download data every day.
I thought it's the most interesting of all smart devices, but I was looking for next gen which hopefully would be wireless and smaller.
Heart rate monitoring is a bit of a sham, if you're looking to use it during exercise. It's designed to gather more of an average rate throughout the day than give an accurate reading while you're exercising.
The Basis tracks sleep without you having to put it in sleep mode (e.g jawbone UP), which is pretty handy.
They recently added some features that attempt to recognize walking/running/biking automatically ("BodyIQ" is the marketing name). I found it oddly useful for seeing how long it took me to walk places.
Coolest feature: if you rotate your wrist quickly (as you would to look at a watch), the face lights up automatically.
Bluetooth sync works well with Android, pretty useless with iPhone (you have to keep the app open and phone awake or it tends to be flaky).
Basically I like the watch, but for weird reasons - the health tracking isn't really that much better than others, but there are little surprises here and there that make it useful for me. YMMV, and I really don't think seeing how many steps you took in a day will ever be life-changing for anyone.
There's no offical API, but you can figure out the HTTP calls to make. My husband wrote some Nagios checks for himself. We just gotta pay attention to the "heart rate is CRITICAL" alerts now :P
While not publicly announced, a RESTy JSON API has been available since day one since that's what the web interface uses - it's very easy to access and there are plenty of open source libs like https://github.com/btroia/basis-data-export
Heart rate isn't exercise-class (like the Mio Alpha) but is using the same green LED photometry, just not running at a very high temporal resolution.
Agree that the Bluetooth implementation is terrible on iOS. Slightly better on Android, but I still end up using their (proprietary! ugh) cable to sync more often than not.
The Basis is unique in the sense that besides the (Jawbone acquired) BodyMedia devices, it's the only multi-modal fitness sensor on the market right now, and IMO the photometry heart rate tracking, and the habits are a big step in the right direction.
That being said, Basis seems to have made surprisingly slow progress and I have a feeling that Apple will eat their lunch sooner rather than later.
Can someone explain to me Intel's continued fascination with being a consumer company? From constant B2C advertising to their TV and wearable endeavors, they seem to be fixated on being something they're not. Is it corporate vanity? Is there a strategic motivation? If so, have any of their consumer endeavors ever actually borne fruit? I guess it's reminiscent of Microsoft, who don't seem to understand that Windows was not successful because consumers liked it, but because businesses bought it.
I think Intel's "strategic motivation" is simple. The US stock market demands ever increasing revenues and earnings from a company. In order to achieve that, often companies do something that the great Peter Lynch called "diworsification" [0]:
The term was coined by legendary investor Peter Lynch in his book, "One Up Wall Street," where he suggested that a business that diversifies too widely, risks destroying their original business, because management time, energy and resources are diverted from the original investment.
Without continuing earnings and revenue growth, a company is "dead" to much of Wall Street.
I just posted another comment as to what IMO Intel should be doing instead. They should "stick to the knitting". E.g. they could try to become a world class foundry. They've got the fabs, they've got thousands of great engineers. I guess that's just not as sexy as a watch that also measures your perspiration.
It's a shame that the one time event of going public dooms a company for perpetuity to being subject to the unreasonable demands of shareholders, so often ironically resulting in the downfall of the very value that was supposed to rise as a result of said demands.
It's even more ironic that companies which make astounding profits (cf Apple) and largely ignore the whims of shareholders (cf Apple) are constantly berated for this.
The alternative to diworsification would be share buybacks. That's a way to increase your EPS without having to grow your earnings numbers.
Intel's diversification probably has more to do with internalization of the mantra "if you're not growing, you're dying" than pressure from Wall Street.
I'm in favor of diversification but not diworsification. E.g. when Apple already makes an iPod and an iPhone then it's smart diversification to make an iPad. That gets you growth without needing to resort to share buybacks.
Apple's smart growth is much better than the flailing growth that many companies attempt. E.g. Google has search so Microsoft does Bing. Apple has the iPod so Microsoft does the Zune.
New products are OK if they are clearly better than what is already out there, but in Microsoft's case they weren't. Contrast with the iPhone. It was IMO clearly better than what was already out there, if for no other reason than Apple refused to be the wireless carriers' bitch.
But now even Apple is doing share buybacks, because they're running out of smart diversification ideas. An iWatch wouldn't be big enough to provide meaningful growth. I'm sure they'll eventually do it, but the law of large numbers is no longer on Apple's side.
The example I gave of me wanting Intel to become a world class foundry is IMO smart diversification. TSM's market cap is about $93 billion. So, clearly, there's room for competition.
Im not a business analyst but possible explanation: Intel want their chips in embedded, low power devices, beating ARM chips to new markets. Nobody is building x86 wearables, so Intel want to start the ball rolling by doing it themselves. similar to how they subsidize x86 tablets.
Is any of this affecting their products? I can't think of any Intel product I've ever owned that wasn't extremely well-made. Their prices are also good. $350 for a 22nm 4-core chip with with 8M of cache? That's nothing. I also like their SSDs and Xeon processors. The Haswell integrated graphics are also very, very good. (My $600 NVidia card has major issues with MST DisplayPort monitors. The Intel chipset Just Works.)
To me it just sounds like they hired a marketing firm to get people to pick Intel over AMD when they don't actually care what they're getting. Nothing wrong with that.
(As for mobile, Intel is getting their lunch eaten by ARM, so I can see why they might want to put more skin in the mobile game. Although, as I understand it, Intel just sells ARM manufacturers time in their last-gen fabs, thus making ARM cheaper than current-gen Intel stuff, but with not as much raw power. ARM cores make up for lack of raw power with lots of special functionality on-die, like video decoders and encoders, which your x86 Intel chip will just do in software.)
I haven't heard anything about Intel selling ARM manufacturers fab time, even on obsolete processes. AFAIK Intel has not really been in the foundry business until very recently. And even that has been with extremely high margin products that don't compete with Intel, such as FPGAs.
Even if they were fabbing some ARM chip, I don't think it could be one of the big players. For example Qualcomm, Nvidia, and TI use TSMC. Apple and Samsung use Samsung's fabs.
You're mostly right about it not being one of the big players. Altera is a big player in the FPGA market, but not the ARM market. The chips in question cost thousands of dollars; the ARM core is a very small portion of the chip.
They need to keep their fabs running at a reasonably high capacity to keep per chip production costs down. That enables them to keep the nice high margins on premium parts like server chips.
Can someone explain to me Intel's continued fascination with being a consumer company?
I suspect that Intel is buying companies and products like this for the same reason that Microsoft bought Nokia -- they see some markets moving away from them, and rather than convincing other manufacturers and fighting competing inertia, they're going to try to make the market themselves.
That isn't to be dismissive of Intel at all -- they are a tremendous company, and their products are virtually always class leading (in capability and quality). But they were making so much money on the fat processor market they got lured into the classic fallacy of thinking that they were their own biggest competitor, and now the whole ARM ecosystem has turned into a remarkably capable foe.
I wonder if this will make an API less or more likely. #1 complaint with the watch. Simple stuff like wifi weight scale and runkeeper cardio integration would be pretty nice!
There's no offical API, but you can figure out the HTTP calls to make. My husband wrote some Nagios checks for himself. We just gotta pay attention to the "heart rate is CRITICAL" alerts now :P
My husband has one and wrote some Nagios checks which download the data over the web. He's basically put himself on Nagios. We just gotta pay attention to the "heart rate is CRITICAL" alerts now :P
I predict wearables, specifically smartwatches, are the next huge consumer category. The tipping point to
mainstream will occur when the fashion of the watches catches up with the technology.
I really like my Basis smartwarch - I've only not worn it about 5 days in the last 6 months (since it arrived). I hope they keep the web software running for years to come, the thing is very cloud dependant!
42 comments
[ 31.9 ms ] story [ 195 ms ] threadI can't imagine basis had any tech that Intel couldn't replicate, and this seems like too much for talent acquisition.
Not what I would drop $100M on if I was Intel.
Keep the fab full
The rest of the company exists to feed the fab. So it doesn't surprise me, the lengths they are going in an effort to get Intel silicon into more devices (and more types of devices), especially after they missed the smartphone wave.
[1] http://en.wikipedia.org/wiki/Game_%26_Watch
http://en.wikipedia.org/wiki/Nelsonic_Industries
?
[0] http://www.flickr.com/photos/joshb/320868833/?rb=1
I expect there to be some kind of onboarding of the WhatsApp customer base onto FB as smartphones get adopted in those parts of the world.
I'm sure there are all kinds of arguments, explanations, justifications, rationalizations (call it what you will) for FB's purchase of WhatsApp. But my gut feel is that it's not worth paying 1000x TTM revenues for it. Admittedly a large part of the price was in stock not cash.
Same with Intel's purchase. My gut feel is they shouldn't be buying a watch company. Intel has an abysmal track record with acquisitions. I think it's a sign that they're desperately flailing around. I'd rather see them try to become a world class foundry. They certainly have the technology and expertise, and it's much closer to the CEO's background. I.e. "stick to the knitting".
It's nice to see that they have an API to export your data too.
They focused on gamification and achievements you can unlock ("slept full 8 hours" etc). However it lacks any wireless connectivity, so you need to plug to your computer to download data every day.
I thought it's the most interesting of all smart devices, but I was looking for next gen which hopefully would be wireless and smaller.
Recent ones sync automatically over bluetooth with an smartphone
I regularly sync mine with my iPhone.
Heart rate monitoring is a bit of a sham, if you're looking to use it during exercise. It's designed to gather more of an average rate throughout the day than give an accurate reading while you're exercising.
The Basis tracks sleep without you having to put it in sleep mode (e.g jawbone UP), which is pretty handy.
They recently added some features that attempt to recognize walking/running/biking automatically ("BodyIQ" is the marketing name). I found it oddly useful for seeing how long it took me to walk places.
Coolest feature: if you rotate your wrist quickly (as you would to look at a watch), the face lights up automatically.
Bluetooth sync works well with Android, pretty useless with iPhone (you have to keep the app open and phone awake or it tends to be flaky).
Basically I like the watch, but for weird reasons - the health tracking isn't really that much better than others, but there are little surprises here and there that make it useful for me. YMMV, and I really don't think seeing how many steps you took in a day will ever be life-changing for anyone.
http://tomsalmon.eu/2013/12/data-download-and-nagios-plugin-...
Heart rate isn't exercise-class (like the Mio Alpha) but is using the same green LED photometry, just not running at a very high temporal resolution.
Agree that the Bluetooth implementation is terrible on iOS. Slightly better on Android, but I still end up using their (proprietary! ugh) cable to sync more often than not.
The Basis is unique in the sense that besides the (Jawbone acquired) BodyMedia devices, it's the only multi-modal fitness sensor on the market right now, and IMO the photometry heart rate tracking, and the habits are a big step in the right direction.
That being said, Basis seems to have made surprisingly slow progress and I have a feeling that Apple will eat their lunch sooner rather than later.
I just posted another comment as to what IMO Intel should be doing instead. They should "stick to the knitting". E.g. they could try to become a world class foundry. They've got the fabs, they've got thousands of great engineers. I guess that's just not as sexy as a watch that also measures your perspiration.
[0] http://www.investopedia.com/terms/d/diworsification.asp
Intel's diversification probably has more to do with internalization of the mantra "if you're not growing, you're dying" than pressure from Wall Street.
Apple's smart growth is much better than the flailing growth that many companies attempt. E.g. Google has search so Microsoft does Bing. Apple has the iPod so Microsoft does the Zune.
New products are OK if they are clearly better than what is already out there, but in Microsoft's case they weren't. Contrast with the iPhone. It was IMO clearly better than what was already out there, if for no other reason than Apple refused to be the wireless carriers' bitch.
But now even Apple is doing share buybacks, because they're running out of smart diversification ideas. An iWatch wouldn't be big enough to provide meaningful growth. I'm sure they'll eventually do it, but the law of large numbers is no longer on Apple's side.
The example I gave of me wanting Intel to become a world class foundry is IMO smart diversification. TSM's market cap is about $93 billion. So, clearly, there's room for competition.
To me it just sounds like they hired a marketing firm to get people to pick Intel over AMD when they don't actually care what they're getting. Nothing wrong with that.
(As for mobile, Intel is getting their lunch eaten by ARM, so I can see why they might want to put more skin in the mobile game. Although, as I understand it, Intel just sells ARM manufacturers time in their last-gen fabs, thus making ARM cheaper than current-gen Intel stuff, but with not as much raw power. ARM cores make up for lack of raw power with lots of special functionality on-die, like video decoders and encoders, which your x86 Intel chip will just do in software.)
Even if they were fabbing some ARM chip, I don't think it could be one of the big players. For example Qualcomm, Nvidia, and TI use TSMC. Apple and Samsung use Samsung's fabs.
You're mostly right about it not being one of the big players. Altera is a big player in the FPGA market, but not the ARM market. The chips in question cost thousands of dollars; the ARM core is a very small portion of the chip.
http://www.nytimes.com/2014/02/16/technology/intels-sharp-ey...
I suspect that Intel is buying companies and products like this for the same reason that Microsoft bought Nokia -- they see some markets moving away from them, and rather than convincing other manufacturers and fighting competing inertia, they're going to try to make the market themselves.
That isn't to be dismissive of Intel at all -- they are a tremendous company, and their products are virtually always class leading (in capability and quality). But they were making so much money on the fat processor market they got lured into the classic fallacy of thinking that they were their own biggest competitor, and now the whole ARM ecosystem has turned into a remarkably capable foe.
Otherwise congrats to the company!
http://tomsalmon.eu/2013/12/data-download-and-nagios-plugin-...
http://tomsalmon.eu/2013/12/data-download-and-nagios-plugin-...