Updated on June 1: Nokia completes sale of Withings back to Eric Carreel.
Nokia is reportedly scaling back its digital health business
Wearables are certainly a tough business. Just ask one of the many companies who have tried — and have failed — to remain relevant in the currently rather lackluster space. From Jawbone to Basis, the tech landscape is riddled with the graves of companies that tried and failed to produce compelling smartwatches and fitness bands, and now, we’re looking at yet another tombstone.
Just a couple months after a report from Reuterssuggested that Nokia had begun “a strategic review of its digital health business,” cutting up to 400 related jobs,the Finnish gear company made things official, announcing that it would be selling its health-tech business back whence it came.On Wednesday, May 2, Nokia announcedit would be selling its ill-fated health tech division back toEric Carreel, the co-founder of Withings, which also happens to be the health-tech startup that Nokia bought just two years ago.
On Thursday, May 31, Nokia completed the sale of its digital health division to the former (and now current) executive. Carreel plans to relaunch the entire business, complete with its 200 employees, as the new and improved Withings brand by the end of 2018. Its products will focus on preventative health.
“I am delighted to start working again with the brilliant teams that made the brand such a great success,” Carreel said in a statement. “We have an exciting challenge ahead of us as we continue to push the boundaries of connected health.”
It’s clear that Withings, even under new leadership and without the pressure of the larger Nokia brand, will be facing an uphill battle when it comes to the health tech industry. But Carreel is under no false pretenses about what lies ahead.
“We are still only just starting to discover what connected health can really bring to people,” he said. “From now on we must concentrate our efforts on developing tools capable of advanced measurements and the associated services that can help prevent chronic health conditions. Today’s technologies allow us to imagine solutions that have the potential to benefit the lives of millions of people, and our ambition is to ensure that we, as Withings, lead the way with technological advances and intuitive designs.”
While details around the deal have not yet been revealed, it’s safe to assume that Nokia will be losing quite a bit of money. Nokia purchased Withings for $191 million, but given that Nokia is effectively returning the company, we can only assume that it’s not for a profit.
The decision to sell the business back to Carreel will help Nokia shift to being abusiness-to-business and licensing company, the company said in a press release.
In some ways, it’s a surprising about-face for both teams. You may know Withings for its work in activity trackers and smart thermometers, and for some time, it seemed as though it had the potential to be the next big thing in the digital health space.