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Comment by hedora | Hacker News Reader

Tldr: FitBit acquires() bankrupt pebble, lays of 60% of staff, cancels all pebble product lines. FitBit also cancels the warranties on already sold pebbles. FitBit may also have stiffed some holders of $27m of pebble's debt.

() due to legal shenanigans we must not call this an acquisition or an acqui-hire. Also, FitBit didn't do those things, a shell company created by this deal did, which is totally different somehow.

When things like this happen, I always hope that consumers that got screwed over by the deal (and people that hear about it) avoid the acquiring company after the fact. If they treat pebble customers like this, how will they treat their own customers later?

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This couldn't be further from the truth: Pebble is going under, and Fitbit is buying up their software IP before they do. Fitbit didn't buy the company or acquire the employees. They aren't shutting down Pebble's product lines, or canceling the warranties (Pebble's doing that). And they didn't acquire the people, rather offered them jobs:

"Fitbit began sending job offers to about 40 percent of Pebble’s employees in the last week. Most of these are software engineers."

https://www.bloomberg.com/news/articles/2016-12-07/pebble-sa...

> When things like this happen, I always hope that consumers that got screwed over by the deal (and people that hear about it) avoid the acquiring company after the fact. If they treat pebble customers like this, how will they treat their own customers later?

Well, the CEO of Pebble Technology, Corp is joining YC.

Also, the services aren't shutting down right away.

If everyone gets their money back, the major downside is the lack of warranty and the lack of fixes to the product. Especially any security & reliability fixes.

As a Pebble 2 owner who is happy with the product as-is I am not sure if I should be happy I did receive my Pebble 2.

The trouble is all the apps come via the services. I hope they release some tools so you can at least install all the watchfaces; maybe give their repo/archives over to archive.org or some other entity that can at least maintain what's there even if you can't add anything new.

This is the trouble with everything hosted in "the cloud" or where you have apps that need to be downloaded. If the company and distribution platform goes away, your device can become useless (or require way more effort to get working).

It's like trying to play an old MMORPG you paid for years ago, but is gone today.

Why does FitBit have the responsibility of providing support for another company’s products? If they didn’t buy Pebble, it would’ve shuttered anyways and they might not even refund the preorders.

Because they bought the assets? Why should they be able to only get the good stuff, and not the responsibility?

Would it have been better for Pebble to go bankrupt, shutdown their services now, and not refund anyone's orders?

Honestly, probably. Because then the precedent wouldn't be continued that companies can shirk responsibility for things they acquire.

Because that’s how the real world works? If you tagged on the responsibility, they would’ve just paid less for it. It’s Pebble and their investors that only sold the good stuff to maximise their returns.

When you buy a company, you don't buy just the assets. You also acquire the liabilities, which include debt, warranties and support contracts.

What if you instead of buying the company you buy the assets? Why would anyone buy a company with negative value?

Once the operations have failed the various creditors likely benefit from reasonably priced sales the assets.

Which is why they did not buy the company. The company is going bankrupt and sold IP to recover money to pay some of the debts with. If you did that to a healthy company that might be fraudulent, but when the company is going under either way it is probably not.

Agreed, but I didn't see anything about court approval for this deal. If a neutral third party signed off on it being the best deal (for the creditors and customers) possible, then fine.

Clearly that did not happen, because they stopped support for warranties. So only a moral, not factual, argument could work here.

Unless you buy the company in liquidation (chapter 7 style) which is more and more what this seems like.

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