Wearables are one of the hottest areas of technology, but while attention is widespread, adoption is not.
For those not in the know, 'wearables' refers to the electronic technologies or computers incorporated into watches, contact lenses, eyewear, bracelets, rings, clothing and more — all designed to be worn on the body. Wearables can be anything from wristwatches that discreetly alert users to text messages and emails, to activity trackers that measure blood pressure, heart rate, daily steps taken and sleep quality. There's also eyewear such as Google Glass that provides the wearer with a small computer screen that overlays their field of vision.
So far, fitness and health wearables have dominated the market, with the Fitbit, Jawbone and Nike Fuelband among the hottest sellers. Glass has garnered plenty of attention, but with limited availability of the $1,500 device, it hasn't yet reached a broad audience.
Some in the media reported the end of the era of wearables when Nike announced in April that it was laying off most of the team responsible for its Fuelband, signifying its likely demise.
The overall consensus among tech analysts is that the wearables industry is still in its infancy, and will evolve into a completely different animal in the next few years, as devices become smaller and less obtrusive, and do far more than so far imagined.
Overall, the wearables market is expected to skyrocket. A Transparency Market Research report estimated that the global wearable technology market stood at $750 million in 2012 and expected it to reach $5.8 billion in 2018. Others consider that estimate conservative. Last year, Juniper Research predicted that worldwide spending on wearable technology would reach $1.4 billion in 2013, rising to $19 billion by 2018.
But which bits of today's wearables market will survive long-term, and which will change? Analysts and industry experts have strong opinions on the subject, the issues including visibility, market consolidation, fashion, and optimal form factor.
Limitations of wearables
The problem with many wearables right now is they don't provide enough information to keep consumers interested in their continued use. As reported by TechRepublic in February, an Endeavour Partners survey revealed that more than half of US adults with fitness wearables had stopped using their device, and a third of those had stopped using it within six months of receiving it.
Dan Ledger, principal at Endeavour Partners, said, "the devices out there today are pretty simple. They're not really for everyone. They don't provide a sustained benefit for many people. The people who benefit from these devices are a small subset of those who own them."
The number of people who have stashed wearable tech in a forgotten drawer has led many people to ask if wearables are coming to an end. "They want to know if this was a big bubble. But we're really just at the beginning," Ledger said.
Fred Steube, senior director of emerging technology for Cox Target Media, has been using Glass since last year as a Glass Explorer. "It's so early in the wearables timeframe that adoption will continue to skyrocket, because if you look at overall growth rates it’s still aggressive growth as they provide more utility and value. I think there's massive growth and there will be many form factors to come. I think it will be a battle to come whether the winning form factor is over the ear or over the eye or over the wrist."
Mike Bruno, senior director of business development for advanced technologies and future innovations of NXP Semiconductors, said, "I don't think the death of wearables is imminent. We think it's still in its infancy. It's just shy of the growth curve. People are feeling their way through it. We’ve gone through the whole activity tracker stuff. It was, and is to a degree, now a neat gadget that people want to try and see what it does and six months from now they find it underneath their socks or in a drawer somewhere."
"The limitations of what the technology was able to enable from a functional standpoint is what is causing people to say that wearables are dead," Bruno said.
Perhaps indicative of what it takes to make a wearable successful is looking at the past. "Hearing aids are the most successful wearables to date. It's not about glamour, it's bringing value to an individual," Bruno said.
Security of personal information is also a concern among those using Google Glass and other wearables. It's not just what the devices can record, as with Glass, that's the problem, but the vast amount of data collected about an individual's habits and daily activities. How companies will use this data, and its security, is of concern, according to analysts.
Wearables in the enterprise
ZDNet and TechRepublic's premium content sister site, Tech Pro Research, conducted an April 2014 survey to uncover current and future plans for wearables in the enterprise. In the resulting report, Wearables in business: Deployment plans, anticipated benefits and adoption roadblocks, 92 percent of respondents said they were familiar with wearables, but only 11 percent said that wearables were being used within their organization, in the process of being implemented, or budgeted for future implementation. Another 25 percent of those surveyed said that they were planning to use wearables in the enterprise, but have not yet allocated a budget for them. And 64 percent said they have no plans to implement wearable devices at their company.
Also interesting in the Tech Pro Research report is that there are differences in the expected and realized benefits from wearables used in business. Many survey respondents said that they had hoped to have improved communication, enhanced productivity and better customer relations as a result of the use of wearables within their organizations. While these expected benefits did, indeed, rank near the top of actual benefits experienced, there were other expected benefits such as better gathering/recording/processing of data, greater access to information and personal assistance that ended up ranking near the bottom of the actual benefits received.
In fairness, other benefits that weren't expected to rank high — testing and experimenting with new products, better health and/or health awareness and improved security/privacy at site — ended up ranking higher in actual use than in theory.
Preferred form factors
Many analysts are assessing whether people would prefer to wear a visible device, or one that's hidden from view. Tech Pro Research found that 39 percent of those surveyed said they'd prefer a wearable device that wasn't visible, compared to 26 percent who said they would want to wear a visible device. The remaining 35 percent said they had no preference. This could indicate that the socially awkward geek factor is lessening among wearables.
As noted in Tech Pro Research's report, this doesn't mean that wearables in the enterprise are doomed. Instead, it means that wearable manufacturers need to establish more clearly defined business uses to appeal to the enterprise.
The future form factor that might succeed is a patch that could be worn on the body, or carried in a wallet or on a key ring. Bruno said that he anticipates a wearable that provides a biometric interface to the user's medical providers as the most likely device to succeed long term.
Analysts predict the healthcare and medical industries will be a major user of future wearables.
"If you look at the devices available today, you'll realize that your smartphone can do the same thing, but you can also opt to wear it on your wrist. In the future, wearables will be very different from a smartphone or other devices we already carry with us," Ledger said.
Fitness will remain a strong market as well, said Steve Holmes, vice president of the new devices group at Intel.
"I definitely think fitness is a natural starting point because the kind of metrics you can collect tell you a lot about your ability to perform whether it's running or cycling. Fitness is a place where people demonstrated a willingness to spend money to improve their performance," Holmes said.
The data analysis of all of the information collected will be key to the success of a device. "Having a huge collection of information is useful only if you can work your way through it and understand what it means," Holmes said.
"Eventually wearables will become an everyday part of people's lives. Wearables are distinct because they are intimate. They are connected to your body so the kind of information they can provide is unlike tablets or phones or PCs. In terms of identifying you, they have unique characteristics. They are persistent. They can provide information about things in your life all day long as opposed to just when you pull them out of your pocket or backpack. And they're immediate. You can have a wearable that is always listening to you. That's hard to do with a phone on your desk or in your pocket," Holmes said.
"The way that connectivity will be distributed around your body will evolve over time. I don't know that there is a killer location yet for wearables on your body," Holmes said.
David DeWolf, CEO of 3Pillar Global, said, "Technology is at its best when it gets out of the way, when it's not something unique I have to think about. That's why mobile took off. I didn’t have to sit down at my desk anymore. I didn’t have to sit down with my laptop anymore. I think that's the next step of wearables. I don't need a phone anymore in my pocket, can the phone combine with the wallet already in my pocket, or the watch that I already wear?"
"The wearable is all about two things. What these devices provide more of than anything is the ability to collect information in a continuous fashion and for us to be able to digest that. The form factor is so important to get it to stick. Once we hit that chord, the software space will explode and we'll figure out how to leverage those devices. The old school used to be about managing information. Today it's about monetizing information," DeWolf said.
"There will be different niches that take off. I think they will all be content and data specific. Doctors and practitioners in the health space will be able to leverage this data. But I think we have some high barriers to get over. I think a lot of these companies are seeing a lower bar in fitness than in health. They want to see if they can penetrate the market in fitness before they get into health," DeWolf said.
Devices will get smaller, predicted Rich Tehrani, CEO of TMC, which produces the Wearable Tech Expo. Tehrani said, "There's a benefit to being discreet right now in the wearable tech space. Likewise with Bluetooth headsets, etcetera, the smaller the better. Unless something dramatic changes, and when I say dramatic I say if we start to see a push from the media or Hollywood or fashion leaders, that could change things pretty quickly. If there's a hit movie where there are wearable tie-ins and they're received positively by the media and the population, then that would change things. But generally we're getting to a world of discretion where these things aren't too showy and they need to look good."
Fashionable design matters
The fashion aspect of wearables is also a consideration, because people want to wear something that works well, and that looks good, too.
"The blending of fashion and wearables is interesting. The most grizzled-like worker if he's using a handheld scanner, doesn't care what it looks like. But the moment you have him wrap something on his arm or on his head, he'll go and look in the mirror to see how he looks. When people put wearable technology on, they care about how it looks. They don't want to look stupid. They want to enhance their persona, not degrade it," said Curt Croley, senior director of Motorola Solutions' design and innovation team.
There will be more partnerships between technology brands and fashion brands, said Sonny Vu, founder of Misfit Wearables. He said, in a previous TechRepublic article, "Appealing to a person's sense of fashion will be part of what makes wearables a lot more wearable. There will be better designs and better materials and connections to brands. When you have a Louis Vuitton purse it says something about you versus a Kate Spade purse versus a Stella McCartney purse. This is going to be one of the things that make wearables a lot more mainstream."
The consolidation game
Market consolidation is inevitable, as often happens in a new industry, says Dan Ledger.
"Apple and Google are really going to catalyze this. The space is dominated by smaller players right now. As we see Apple and Google get into the space, particularly with Android Wear, they will really will have the capabilities to bring the technology to the next level. A lot of the players today are relatively small compared to the big OEMs right now. So they don't have access to the capabilities to fab their own components that are specifically made for wearables. That’s why we tend to see some of these bigger clunkier form factors and whatnot."
Once the technology giants get involved, he predicts the component technology will dramatically improve and sleeker devices will be on the market.
"We're going to see the design aspects of this really take a leap and the technology will slowly start to disappear into the design of these products. We see this stuff happening already with Misfit doing design in their wearables. Design is going to become a much bigger deal in the next two or three years and as the technology gets better, the design will disappear more. It will be a really cool bracelet that does all sorts of other things, too," added Ledger.
Mass market adoption will happen when a combination of measurements are available in a single device that tell something different than anything currently available on the market, according to Ledger.
The form factor that will succeed is truly anyone's guess. Will it be a patch, a contact lens, or a wristwatch? People are most comfortable with devices worn on the wrist, but the right pair of eyewear might change their minds.
The one thing that is certain is that the wearables industry will look vastly different in five years. The data collected could be used in a variety of ways, from streamlining doctors' visits with instant access to health information, to maximizing fitness workouts by determining how to get the most benefit from a session, or giving employees the ability to work hands-free in remote settings.
To find out additional information about the future of wearables, read Tech Pro Research’s latest report on wearables in the enterprise.