A new research report from Swedish analyst firm Berg Insight delivers significant insights on the projected growth of the wearable technology market. The report begins with a baseline that notes that worldwide shipments of all wearable devices were estimated to be 3.1 million in 2011 and 8.3 million in 2012. Berg further notes that it anticipates compound annual wearable technology market growth to run at a hefty 50.6 percent for the foreseeable future.
Berg is now projecting that total shipments of wearable technology devices - which includes health and fitness trackers, smart glasses, smart watches, and myriad other wearable devices will very likely reach a massive 64.0 million units in 2017. Berg further notes that though today wearable fitness and activity trackers constitute the vast majority of these shipments. By the end of the forecast period, however, Berg believes that smartwatches will simply incorporate much of the functionality of these devices and will then become the largest wearable device segment.
This trajectory certainly makes sense to us. The question is whether or not smartwatch functionality and the collective sensors needed to deliver will be good enough to offer the consumer or even professional health coaches and their colleagues the high quality user experiences that are necessary to win over audiences. Apple's (News - Alert) Tim Cook is on record as saying that he has yet to see any devices that can merge disparate functionalities in ways that can delight the user. This is certainly something Apple is working on from its end - the user experience is critical for success.
Johan Svanberg, senior analyst at Berg Insight notes, “A perfect storm of innovation within low power wireless connectivity, sensor technology, big data, cloud services, voice user interfaces and mobile computing power is coming together and paves the way for connected wearable technology. The first generation of products appeal to specific markets and certain use cases, but refinement in design, technology and connectivity will broaden application areas and speed up market adoption."
Svanberg's observations are certainly spot on. Underneath what he says there is a discernible machine to machine (M2M) aspect to the argument as well. He is particularly right to note that in essence it is the entire developing underlying ecosystem ("low power wireless connectivity, sensor technology, big data, cloud services, voice user interfaces and mobile computing power") that will drive everything in wearable technology as it becomes a major market segment.
Svanberg goes on to say, "Initially, the wrist is the most attractive location for wearable devices, which is shown by the success of the Pebble smartwatch and the popularity of wristband activity trackers such as the Nike Fuelband and the Fitbit Flex. However, today’s devices need to evolve into something more than single purpose fitness trackers or external smartphone notification centers in order to be truly successful."
Berg Insight further predicts that wearable technology will shift from being smartphone accessories into becoming proper stand-alone computing devices. Furthermore, closeness to the body and always-aware capabilities will enable them to be more than merely miniaturized smartphones. We certainly agree with all of this. The bottom line here is that Berg underscores our own belief that the wearable tech market will continue to grow and will become a major tech driver over the rest of the current decade.
Edited by Alisen Downey
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