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Friday, April 25, 2014, 06:18 pm PT (09:18 pm ET)

Nike to focus on 'digital sport' software, excited about future Apple collaborations

In an interview on Friday, Nike CEO Mark Parker said his company is not giving up on its "digital sport" initiative with the apparent demise of FuelBand and will instead pursue expansion of the NikeFuel ecosystem through high-profile partners like Apple.

FuelBand SE


Following a report that Nike had laid off a good portion of its FuelBand hardware team, Parker told CNBC that the company is looking to expand the reach of NikeFuel through partnerships with other companies.

When asked if Nike is planning to exit the wearable hardware market, Parker said, "We are focusing more on the software side of the experience. I think we will be part of wearables going forward."

While the Nike chief did not confirm the FuelBand's death, he did say there will be a stronger push on the software side of the company's proprietary NikeFuel activity quantification and measurement system. There was some confusion, however, as Parker may have misspoke when he said there are some 30 million FuelBands in circulation, a number Nike hopes to boost to 100 million.

According to recent estimates from market research group NPD, as reported by MobiHealthNews, Nike's fitness tracker accounted for only ten percent of $330 million in fitness tracker sales for 2013. Factoring in a $150 price tag, Nike sold roughly 220,000 FuelBands last year.

If Parker's estimate of 30 million FuelBand users is true, Nike would have sold a combined 28.8 million devices over the band's first year of sales in 2012 and the first quarter of 2014. A more plausible explanation is that Parker meant 30 million NikeFuel users, though CNBC's reporter failed to clarify the statement.

In any case, the CEO did not give a clear-cut answer regarding the future of FuelBand and instead emphasized the company's commitment to expanding NikeFuel through partnerships with companies like Apple.

To that end, Nike recently opened the Nike+ Fuel Lab in San Francisco as a type of incubator for ideas ways to implement NikeFuel into third-party products. While the effort is largely seen as a software effort, the lab could foster hardware integration solutions as well.



As for the possibility of an Apple-made device that incorporates NikeFuel (perhaps the rumored iWatch), Parker was coy on the subject. He did, however, acknowledge the rampant speculation.

"I will just say that the relationship between Nike and Apple will continue," Parker said, adding, "I am personally — as we all are at Nike — very excited about what's to come."

Nike and Apple have collaborated on projects like Nike+iPod and more current Nike+ app integration. Apple CEO Tim Cook has sat on Nike's board for nine years, which likely played a role in the brand's ability to stay on the cutting edge of fitness software incorporated into Apple products.