Monday, October 2, 2017

Fitbit and Publicness

As some of our BLPB readers know, I am a habitual 12,000-step-a-day walker.  I monitor my progress on steps, stairs, and sometimes sleep using a Fitbit "One" that I have had since Christmas Day 2012.  Fitbit recently announced that it is discontinuing the One.  So, if my existing One dies off, I will have to switch trackers.  And, sadly, I am likely to have to switch suppliers.  While Fitbit has been good to me, the rest of its trackers are not at all interesting or suitable for my desired uses.  They are almost all wrist models, and the one clip-on tracker Fitbit sells is relatively bulky and antiquated.

I am not the only one who is unhappy about the discontinuation of the One tracker.  Fitbit has discussion boards for members of its "community."  The discussion board titled "Is Fitbit One being discontinued?" (which was started over the summer) has lit up over the past week.  As of the time of this post, there were 519 posts in the Fitbit forum.  

I have been impressed by the passion of the folks who have posted comments and responses.  Many posted reviews of other Fitbit products and competitor products that might be adequate substitutes for the One for some users.  But I have been fascinated by the nature of several posts, including a number that focus on corporate governance and finance matters.  Community members were motivated to check into and comment on Fitbit's published financial statements, litigation profile, and trends in the mix of product sales.  Some encouraged calling either Fitbit's customer service line or mutual funds that hold Fitbit shares (and they named the funds) to express concerns.  One member of the community posted that he is worried about Fitbit's employees, customers, and shareholders in the event Fitbit's business goes South.  

The comments made on the Fitbit community discussion board reminded me of Hillary Sale's work on publicness, including her article entitled Public Governance.  In that article, she observes:

Publicness is both a process and an outcome. When corporate actors lose sight of the fact that the companies they run and decisions they make impact society more generally, and not just shareholders, they are subjected to publicness. Outside actors like the media, bloggers, and Congress demand reform and become involved in the debate. Decisions about governance move from Wall Street to Main Street.

Hillary A. Sale, Public Governance, 81 Geo. Wash. L. Rev. 1012, 1013 (2013).  She later echoes that thought in a slightly different way:
 
Key to an understanding of publicness . . . is that the group demanding governance is larger than the stated partners (i.e., shareholders, directors, and officers) and includes outside actors. Employing a crabbed definition of this group is actually part of the problem. Those “outsiders” scrutinize decisionmaking and incentives. They monitor failures of internal governance, press for more external governance, and then publicness grows.
 
Id. at 1034.  The users of Fitbit's discussion board are digesting and reporting on Fitbit's operations and seeking governance changes in a public forum.  They are seeking ways to be heard by management.  Moderators occasionally post commentary and promise to pass on comments to Fitbit's management.  This is publicness--feedback loops that enhance public scrutiny and sway over the firm.
 
I doubt any of this will save the Fitbit One.  It seems that the firm is moving on with new products, notwithstanding significant customer demand.  So, once my rechargeable battery dies, I will be in the market for a new tracker.   I am accepting recommendations . . . .

http://lawprofessors.typepad.com/business_law/2017/10/fitbit-and-publicness.html

Corporate Governance, Joan Heminway, Marketing, Technology | Permalink

Comments

The founder of Garmin is a UTK alum, correct? I love my Garmin watch (and it has a step counter, among other features). Not sure if they make anything like the FitBit One. Good luck!

Posted by: Haskell Murray | Oct 3, 2017 8:03:35 AM

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