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Fitbit CEO on Why Turning the iPhone Into an Activity-Tracker Doesn't Hurt Fitbit

In the activity-tracking race, Fitbit is confident it's soaring over its competitors.

Earlier this week, Fitbit, maker of wearable activity trackers, updated its iOS app so that the app now takes advantage of the new M7 co-processor in Apple’s iPhone 5s and lets the smartphone act as a pseudo-Fitbit.

While Fitbit isn’t the first fitness-related app to do this (Nike+ Move, Strava Run and Moves also utilize the new motion co-processor), Fitbit, of course, makes its own hardware, which presents interesting questions about whether the future of activity-tracking will be on the wrist — or right in the smartphone.

Re/code chatted with the company’s co-founder and CEO, James Park, to ask him how the new app works, where he positions Fitbit in the growing activity-tracking market (surprise: No. 1) and his take on future wearables. This conversation has been edited down for length.

Re/code: Explain for us exactly what the iOS update for 5s means for Fitbit users, and how the new app works.

James Park: The way it works, it basically utilizes the m7 co-processor. So once you set up the app you now have the option to pick “mobile track” as the tracking experience. You can only pick mobile track or Fitbit device, you can’t do both, because mobile track is meant to be an introductory experience. So the idea is, you start out using that, and then, as you start using it, maybe you switch over to a dedicated Fitbit device.

So the Fitbit app on iPhone 5s still doesn’t have the full power of a Fitbit?

Well, it measures steps, distance and calories, and uploads it all to your Fitbit dashboard. We’ve made an effort to make it a full experience. We had to do a lot of work to make the calorie [counting] reasonably accurate, to match the capability of the Fitbit.

james_park_fitbit

But we think there are reasons why using just your smartphone for tracking doesn’t work as well. There are instances where you don’t have your smartphone on you throughout the day, especially for women [who might keep it in their purses]. Or you get home and you put it on your coffee table or desk. And you don’t have it on you when you’re sleeping.

Are you concerned at all about cannibalization of your own products?

No, for us it’s about expanding the market. In our research, we’ve found — even with the $59 Fitbit Zip — consumers aren’t sure whether they want to take that step into buying a dedicated device for tracking. So the app is an introductory thing.

And, mobile track is great for iPhone 5s users, but not everybody can use that app feature.

Do you see Fitbit ever being a pure software company or a platform, rather than being both a hardware and software maker?

Probably not. We feel it’s important to control all aspects of the experience, both hardware and software. In our early days, investors and advisers warned us, “Listen, hardware is really hard. Why don’t you just work on software and partner with hardware makers?” But we’ve been around for seven years. And we’ve shown that, while hardware is really difficult, we can do it.

Fitness trackers are growing in popularity, but companies like Fitbit, Jawbone and others have been notoriously tight-lipped about unit sales. How are you measuring how well Fitbit is doing?

I think everyone’s still pretty closely guarded with unit sales. The way we kind of track our sales against our competitors, is if you look at iTunes. For all of 2013 we were the No. 1 app for connected devices in the App Store. We’re consistently in the top five for all apps in health and fitness. And our competitors are pretty far behind.

Also, if you look at Google trends and particularly search volume, we have a pretty substantial leading share of search volume. And if you look at the retail space — like Best Buy — we’re the dominant device in the fitness category. So we feel we’re the pretty solid No. 1 in the category.

Is Fitbit profitable?

I can’t comment on that, but as you know, we raised a $43 million dollar round a few months ago, so we’re pretty comfortable with our cash position.

Let’s talk about the Flex and Force. Some consumers were bummed that they bought the Flex wristband and then about six months later, the new and improved Force came out. Why the back-to-back releases? At the time you put out the Flex, did you know the Force was in the pipeline?

Fitbit Force

A lot of people think of the Force as the successor to Flex, but we look at them as different products for different people. The Flex is for people that have a watch that they really love, but wanted something minimalist on their wrist. And the Force is there for people who don’t mind wearing it as a watch, and see it as a watch replacement.

We knew the Force was coming. But we didn’t want to hold off on the Flex. For us, when products are ready, both from a technology and market point of view, we release them.

With regard to the future of the category, do you think we’re going to see purpose-driven wearables and smartphones remain distinct categories, or will they become conflated?

I draw a distinction between this category and the smartphone category. I think with the smartphone we’ve seen two basic form factors — you have the Samsung Galaxy, the iPhone, and then you have phablets. With wearables I think it’s going to be much more diverse, because the things you wear on your body, it’s a much more sensitive issue. I think there’s going to be a huge amount of different takes on wearable devices. The category that might be under the most pressure, in my opinion, are GPS running watches. I think those are going to suffer the most.

Some people will be satisfied with just using a smartphone for activity tracking, but I think there will be a gradual progression of more and more sensors onto wearable devices like skin sensors, and obviously you can’t use a smartphone for that.

This article originally appeared on Recode.net.