Can Patent Analysis tell us where Jawbone went wrong?

Jawbone, one of the early innovators in the wearable fitness trackers space, is struggling.

Business Insider recently described the company as on “increasingly shaky financial footing” and struggling to manage inventory and pay vendors. Last year BlackRock invested $300 million in the company to keep it afloat, in a deal that Bloomberg news cynically tagged “a loan and a leash”. Now it looks likely that some major restructuring is afoot, and ex-employees of the company have suggested that heavy redundancies look likely.

What happened to Jawbone?

Innovation happens at a relentless pace, but in the tech industry disruption happens even more quickly, more ruthlessly than perhaps any other sector.

Jawbone – also known as Aliph, and AliphCom – started life as an audio and headphone manufacturer in 1999, but moved its focus to wearable health trackers in 2011 with the launch of the Jawbone UP.

We took a look at Jawbone's patent portfolio to see if there are any clues to what happened.

Patent Analysis in Wearable Fitness Trackers

A quick review of published patents filed by Fitbit, Jawbone, and Withings clearly demonstrates the IP landgrab which has taken  place in the fitness tracker market snce 2011. Jawbone had an early head start, but by 2013, Fitbit, despite having a much smaller number of patents, was bolstered by its $43m series D war chest and dominating with a 70% market share of retail fitness tracker sales.

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Did Jawbone Patent to Litigate?

Between 2013 and 2015, Jawbone’s patent activity skyrocketed, as the graph above demonstrates. Is this an indicator that the company's R&D team had made some incredible discoveries and massively increased their patenting activity as a result? Perhaps, but it seems more likely that the company consciously decided to aggressively patent even incremental improvements to their technology. This is likely to have resulted in a massive increase in filing costs - and later, litigation costs to defend those patents.

By the summer of 2015  Jawbone and Fitbit were locked into bitter legal disputes. In the first instance, AliphCom (Jawbone) claimed that Fitbit had “systematically plundered” the company’s executives and encouraged them to steal intellectual property including product roadmaps and designs from the company.

Just two weeks later, Jawbone and BodyMedia, a wholly-owned subsidiary of Jawbone, filed a second lawsuit claiming infringement upon 3 key patents relating to the design and functionality of its wearable devices. A brief look at the citation analysis for one of the patents involved in the case, US Patent 8,398,546 – “System for monitoring and managing body weight and other physiological conditions including iterative and personalized planning, intervention and reporting capability”, shows a large number of forward citations indicating this was a significant patent in the company's portfolio, with an estimated value of $1.4m USD.

Snapshot of Citation Analysis for US Patent 8,398,546

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Innovation Strategy

While Jawbone was quickly able to amass a large number of patents in the wearable fitness tracker space, and developed a strategy of vigorously defending its IP rights, it seems that Fitbit was able to outmanoeuvre its rival. Looking at the innovation strategy of each company, we can see that Jawbone's strategy of pursuing international protection, and focussing on market-driven and joint R&D may have come at the expense of improvements in other areas.

Fitbit's strategy, meanwhile, is extremely concentrated on protecting its IP in the USA, and expanding its patent portfolio into new areas through tech diversification and science-driven R&D. This perhaps meant that it was able to bring more sophisticated products to market and ultimately win a greater market share. 

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Where will Jawbone go next?

Analysts have been quick to focus on Jawbone's lack of new products, and recent news stories do seem to tell a very negative story about the future of the company. However, some news sources have suggested that the company may be working on a more clincal-focussed approach to wearable tech. 

A recent patent might give some insight into this new directon. 

US20160220122A1 - Physiological Characteristics Determinator

 The patent abstract describes the difficulty in using wearable devices to measure real-time blood pressure in a body using signals from sensors. The patent document goes on to descrbe how "conventional blood pressure measurements may require clinical instruments, such as a blood pressure cuff (e.g., a sphygmomanometer) to take a blood pressure reading for systolic and diastolic pressure (e.g., in mmHg). Subsequently, the blood pressure reading may be used as a baseline with other biometric data, such as bioimpedance data, to derive a value of blood pressure from the bioimpedance data. However, obtaining the baseline blood pressure data requires cooperation and availability of the person who is the subject of the blood pressure readings." Aside from the dfficulty in obtaining readings, accuracy can be a problem "biometric data may lead to inaccurate blood pressure determinations due to changes in actual blood pressure caused by activity such as exercise, sleep, rest, arousal, stress, and illness, just to name a few."

So this seems to suggest that at least part of Jawbone's latest innovation may relate to measuring the wearer's blood pressure, taking into account the wearer's baseline blood pressure given that the company is already able to detect and interpret different states of exercise, rest, and sleep. 

Whatever form the company's next innovation takes, it remains to be seen whether it will be enough to revive the company's ailing fortunes.

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