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Is Nike Fuel Apple's first iWatch casualty? The consumer loses in this battle.

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It is sounding more likely that Nike’s Fuelband activity tracking device has cried uncle to Apple’s imminent iWatch launch.

Rumors reported on CNET indicate that not only has Nike fired off the bulk of its staff that supports the development of the Fuelband, but now Nike’s Chief, Mark Parker, indicates that partnerships with key platforms, like Apple, will be the focus. While he was not definitive, Parker did indicate on a recent CNBC interview that the company's focus will no longer be on the internal development of Fuel but it will “be integrated into other products that we create, and then we'll look at expanding our partnerships to create more reach for the Nike Fuel and Fuel system that we have ... and the best way to do that, we think, is through the best partnerships that we can find." Parker specifically mentioned Apple as a long-term partner that it is looking forward to building.

As mentioned in this column last week, Apple’s foray into the wearables marketplace is going to wreak havoc on those companies who have invested millions to bring innovations and product extensions to their existing customers. Apparel and lifestyle brands are clamoring for new ways to bring value to their loyal users as competition for mindshare increases. People don’t just want sneakers anymore – they want gadgets and value extensions. This is due to the increasing number of choices available to spoiled consumers – who have come to expect new cool stuff to keep their interest. Brands like Evernote, Jawbone and Tumi are all jumping into the eco-tech lifestyle arena; offering up a slew of 360 degree ‘everyday’ offerings in an attempt to be all things to all people.

The ever-looming black cloud is Apple - and their firm grip over their consumers lives. As in the Fuelband story, even before the iWatch has become a reality, an uber-brand like Nike throws in the towel on a key segment of their product line – ever aware that Apple’s device on the horizon will be too big of a gorilla to contend with.

Is this good for the consumer? As long as Apple keeps good on its contract with the people to ship the best-in-breed products, we win. But what happens when a stalwart like Nest or Shopkick offers up a better mousetrap, but is locked out of the market by Apple’s unassailable dominance? Consumers lose -- and Apple has to work harder to hold its reputation as the great innovator and product designer. There is always room for the better suitor, but Apple’s dominance could mean doom for more choices. Like the classic Godzilla movies from the late 60s, while the lifestyle monsters (Apple, Samsung, Amazon, Google, Microsoft, etc.) fight it out for world dominance, a lot of buildings get destroyed in the process.

It will be interesting to see who survives.

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