I have been saying for a while that the #fitbit CEO must wake in a cold sweat at 4am every day about his business.
Whilst they are kicking ass with market share today I see trouble ahead, it is after all only a #bluetooth connected #pedometer with some nice software. (I am an owner and I like it but it is what it is)

With a bill of materials and COGS of under $20 Fitbit has been making hay while the Sun shines selling at $70 (or $120 retail in Australia)

I have recently costed out a prototype with some common components so I know exactly what’s in one.

So to give you an idea of the component costs

• 3 axis #accelerometer (the main active component) >$1
• Processor + Bluetooth ($1-2)
• Battery <50c
• Assorted power chips/LEDs ~ $2

Obviously you have to assemble and fabricate and give the retailer a margin but I still think their gross margins must be healthy.

Until now.

#xiaomi has just launched the Mi Band at $16s with 4 times the battery life

 

Watchout Fitbit.