Fitbit has long been the most important name for wearable fitness trackers, and now it seems that the company wants to play a role in mobile contactless payments, just like Apple Pay. The company has just announced that it has purchased Coin and could start to include NFC-based payment options in its products as early as 2017.
Cha-Ching! Fitbit buys Coin
Coin started several years ago as a Kickstarter project that promised to consolidate our credit and debit card collections into one device. It was the same size and shape as a regular credit card, and users could switch from one card to another at the touch of a button thanks to Coin's ability to reprogram its magnetic strip on the fly.
Subsequently, the company developed a technology that allows its combo card device to work with touch-pay POS readers. Coin managed to sell 250,000 units, but it never started great. This translated into an opportunity for Fitbit who said in a statement,
Although it is not planned to integrate Coin's wearable payment technology into the Fitbit 2016 roadmap, the acquisition accelerates Fitbit's ability to develop an active NFC payment solution that can be incorporated into future Fitbit devices, expanding its intelligent abilities.
Translation: You will soon be able to buy a Fitbit that you can wave on a credit card reader instead of extracting your wallet.
Contactless payments are the most important thing thanks to Apple Pay, which was introduced with the iPhone 6. The technology was not new, but until it arrived on the iPhone, consumers and retailers did not show much interest . Many smartphones with an Android operating system offer similar contactless payment capabilities and Samsung also has a version of it. Now Fitbit will also join the retail payment group.
The addition of Coin payment technology to Fitbit will compete with Apple Pay from a mindshare perspective, but from a technological point of view, they are not the same thing, as Dave Hamilton pointed out Daily observations of the TMO podcast. Coin has simply replicated the tap-to-pay technology already incorporated in many credit and debit cards and does not require any back-end transaction support from the company. Apple Pay, however, is a complete transaction system that requires Apple back-end technology, support from the banks and support from retailers.
Involving Coin was a smart move because it helps Fitbit stay relevant in a market where smart watches like Apple Watch are gaining traction and serve many of the health and fitness functions previously dominated by devices like Fitbit's One, Surge and Flex . This is probably the best possible result for Coin because it is not able to get a real grip against NFC enabled smartphones.
For Fitbit users hoping that the company can finally support HealthKit, be prepared for disappointment. Fitbit made it clear early on that he was not interested in participating in Apple's fitness tracking platform, and the purchase of Coin only helps reinforce that wall.