App-enabled smart watch shipments to reach 36M by 2018: report
August 28, 2013
COOKO's smart watch
Although application-enabled smart watch shipments exceeded one million only this year, a new report from Juniper Research predicts that shipments will reach 36 million per year by 2018.
According to the report, smart watch shipments will be driven by a multi-function segment that can add new functionality, such as tracking fitness activities, to the watches. This new segment is expected to be popularized by players such as Apple and Samsung.
“Juniper believes consumer attitude is crucial here," said Nitin Bhas, senior analyst at Juniper Research, Hampshire, UK. "To some consumers, having a smartphone and smart watch at the same time does not make any sense, especially if it is a ‘dumb display’ or dashboard device."
“However, with players such as Apple, Samsung and Microsoft expected to launch similar devices, there will be a demand for these items,” he said. “For any new technology, take-up will be low initially meaning that the demand will be low within the short to medium term at least.
“By educating and publicizing such a device segment to the consumer, Apple and Samsung will indeed act as a catalyst to the market. In addition, being a key influencer, these players’ entry into the wearables market will benefit existing players, providing an increase in awareness and adoption in other app ecosystems.”
Smart watches are still fairly new and have yet to really catch on with consumers.
Mr. Bhas believes that consumers are hesitant to take on smart watches since they have yet to present any additional benefits to the current smart device market.
Once watches can do more than a phone or tablet, they will be able to compete for consumers’ attention.
This report claims that a new multi-function segment will present this added benefit. The segment will allow consumers to track fitness and sports activities as well as payment and ticketing information, for example.
The new segment is expected to be pushed by Apple and Samsung. These two companies will help validate the device and propel its acceptance.
Mr. Bhas expects there to be an increase in adoption in 2014, with smart watches going mainstream in 2015 or 2016.
He adds that smart watches will only appeal to a specific, limited demographic as opposed to the broader scope of tablet and smartphone consumers.
The report also predicts that app-enabled mobile wireless accessory shipments will approach 170 million by 2018.
Figure: Smart Watch Shipments (m) Split by 8 Key Regions 2018: 36 Million
The future of devices
As companies are experimenting with wearable smart devices, it will be interesting to see which devices garner high consumer adoption.
Mr. Bhas expects smart watches to lead the way in short to medium term, but as other types of wearable technology become more mainstream, he expects smart glasses to surpass smart watches in terms of revenue. His prediction stems from the responses to high initial price points.
The report forecasts that with the adoption of app-enabled smart watches in particular, app developers will find new opportunities in the health, fitness, sports and communications segments within smart watches.
“Most wearable devices are always on and accessible at any time with a constant interaction between the user and the device,” Mr. Bhas said.
“Soon brands will be able to develop a more personal approach to the consumer compared to smartphone,” he said.
“However, this will have to be done without spamming the user and causing any inconvenience. They will need to develop apps that will tie in multiple devices’ data together in a useful way.”
Rebecca Borison is editorial assistant on Mobile Marketer, New York
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Comments on "App-enabled smart watch shipments to reach 36M by 2018: report"
Mike Spanjar says:
August 28, 2013 at 8:55am