(NASDAQ:AMZN) has helped Fitbit (NYSE:FIT) sell a ton of its wearable gadgetry over the years, but the online retailer's next act may be that of a competitor more than that of an ally. Amazon keeps taking baby steps into health-monitoring gadgetry, and this week, Arcadia Group, a health brand consultancy, announced that it's teaming up with Amazon to offer a new line of products available exclusively through Amazon's digital storefront.

We're only talking about glucose monitors for diabetics and blood pressure cuffs as the initial products coming out of the new Choice brand. These products will hug your upper arm and prick your finger, but Fitbit is still the only one of the three that will take you by the wrist. Choice also won't be an Amazon private label. Arcadia is developing and will own the brand. It's simply striking a deal to make the brand exclusively available via the e-tailer.

Fitbit investors don't need to break a sweat about this right now, but is anyone truly safe when it comes to Amazon and its disruptive nature? If Amazon decides that fitness tracking is a niche worth exploring with its growing line of hardware, it's not going to make Fitbit's already difficult life any easier. 

Someone wearing a Fitbit Ionic during a workout at a gym.

Image source: Fitbit.

Monitoring the situation 

Fitbit is in a pickle. It was the undisputed champ in the fitness bracelet market when the category was all the rage, but as Apple (NASDAQ:AAPL) and Android smartphones get better about tracking daily activity levels, it's become less necessary to don a dedicated fitness tracker. Apple has also been a thorn in Fitbit's side through Apple Watch, and this summer, it beat Fitbit to the punch when its Apple Watch Series 4 line became the first smartwatch to include heart rate sensors that offer FDA-cleared electrocardiogram readings.

The pressure points are undeniable. Fitbit has posted declining revenue for seven straight quarters, including a 15% year-over-year decline last time out. Fitbit reports its third-quarter results next week, shortly after Wednesday's market close. Analysts are bracing for another slight dip on the top line. 

The silver lining in duking it out with the class act of Cupertino is that Apple's hardware doesn't come cheap. Fitbit's taking Apple head-on with its own smartwatches at lower price points than Apple's latest gadgets and offering even cheaper stand-alone fitness trackers has a definite audience. Unfortunately for Fitbit, that window of opportunity could close if not shatter completely if Amazon jumps into the fray. Amazon competes on price, and it's willing to sell hardware at or in some cases below cost just to establish itself in a category. 

Amazon doesn't always win when it comes to hardware. Fire Phone anyone? It's also important to remember that Amazon has not indicated that it will roll out its own health-monitoring gadgetry, much less the fitness trackers or even smartwatches that Fitbit cranks out. However, Amazon has been known not to stay in its lane over the years. It pays to be a defensive driver -- and not an offensive investor.

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