Smartwatches and wearables: A chaotic market stuck in the dark ages

Smartwatches and wearables: A chaotic market stuck in the dark ages

Summary: The tech industry's search for the next big gadget continues – so wear does it go from here?

It is predicted that wrist-worn devices will account for 87 percent of wearables shipped in 2018. Image: Shutterstock

Smartwatches are getting better, but the technology is still in the dark ages with big obstacles to overcome before it's ready for the mass market.

Many of the wearables sold so far have been pretty poor — indeed, it's entirely possible to see the wearables market right now as a massive trial of (at best) beta-stage technology.

"The wearables market is in its Stone Age right now. There needs to be huge improvements to broaden their appeal," said Marina Koytcheva, director of forecasting at analyst CCS Insight.

The failing is particularly acute when it comes to devices for women, she said. "Wearables need to quickly move on from black, clunky devices; fortunately we're starting to see the first steps in this direction."

According to CCS Insight, 22 million wearable devices will be shipped this year — more than double last year's 9.7 million total.

"The market is still in a chaotic stage of development, and there's still a huge amount of uncertainty," Koytcheva said. "Every category faces different risks: the way people use wearables is still changing, one type of device could kill sales in another category, people are unsure whether some wearables are socially acceptable, and intellectual property rights are a minefield."

The analyst predicts that within four years, shipments of wearable devices could hit 135 million — compare that to the 315 million PCs sold last year, and the nearly one billion smartphones.

The analyst predicts that wrist-worn devices will account for 87 percent of wearables shipped in 2018 – made up of roughly 68 million smartwatches and 50 million smart bands, with either no screen or with a minimal, one-line display.

Fitness trackers are the fastest-growing category, because they have a clearly defined purpose and are relatively affordable. CSS Insight said fitness trackers will account for over half of the 35 million wearables in use at the end of this year.

Before the iWatch: A history of smartwatches, in pictures

Before the iWatch: A history of smartwatches, in pictures

Before the iWatch: A history of smartwatches, in pictures

CCS Insight said smartband manufacturers will try to extend their product ranges by adding devices with screens. In the longer term, as smartwatches broaden their appeal and prices fall, they are likely to displace fitness bands and become the most-used form of wearables.

North America currently leads the way in terms of adoption of wearable tech: 5.2 million wearables were sold in North America in 2013, and more than 40 percent of all wearable devices currently in use are there. Western Europe is catching up and from 2016 is expected to buy more wearables than North America, the analysts predicted. Adoption will be slower in emerging markets and primarily driven by tech-savvy, affluent users.

One type of wearable category that will become much more prominent in the second half of 2014 is standalone cellular wearables. The analysts said a number of high-profile devices with their own SIM cards will be announced in the coming months — but these will face an uphill battle as consumers will be reluctant to take out another contract with their mobile operator.

Still, most of what is happening with smart wearables at the moment is based on the assumption not that there is unfulfilled consumer demand, but that Apple is going to unveil a smartwatch soon, and none of its rivals want to get caught napping. Koytcheva said: "History shows us that when Apple enters a market it can reshape the way people think about a product."

Read more on wearables

Topics: Mobility, Emerging Tech, Innovation

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.


Log in or register to join the discussion
  • I doubt it

    I think it is more about the sequestered capital fat cats are trying to get a return on. So they'll chase anything with their cash hoping to create a demand where none exists.

    Of course the reason they have this money to invest is they stole it from the very people they hope to parasitize (sell them more unneeded doodads). What they don't realize is you can't get blood out of a turnip.
  • Overpriced and unsatisfying

    Probably my main opinion as to why wearables aren't popular. Perhaps public perception isn't ready for the "Dick Tracy" / "Inspector Gadget" look.
    Likely won't be popular unless Giordi becomes the official spokesperson of Google Glass.
  • Agent Smartwatch Fail

    Invested in the kickstarter, had high hopes, but the release is so late now that the technology is getting old. I have seen a lot of great smartwatch concepts but the implementation is always poor. I blame it all on "battery power". We need a giant leap in battery tech for anything great to happen with smartwatches.
    Sean Foley
  • Maybe wearables aren't the future.

    Not everything we wish to be "the future" succeeds. Still waiting on those flying cars and jet packs, no?

    Maybe wearables simply aren't in our future.

    There are no technologies that are inevitable. They live and die at the whims of the consumer.
  • Here's a hjeads up for the device manufacturers

    Why don't you actually do a market survey to find out how many people actually OWN a watch (of any kind)or have any intention to wear one at any time in the future? I don't wear one, have no real intention to wear one (of any kind) and don't see how having one is going to change my life (where art thou, Steve Jobs?).
    • wrist watch industry is alive and well

      Citizen, Casio and many many other companies manage to sell their wears quite well. And I am sure they do their market surveys.

      There are times when one can not look at the cell phone - swimming, wrestling, biking, cooking, rock climbing to name a few. There are people who spend parts of their lives outside of the comfort of their cars and living rooms. If these people also have busy schedules they wear wrist watches.

      Some people wear wrist watches as a fashion statement. Many women own a different watch to go with every outfit - just fyi.

      So the world is much much bigger than the subset visible to each of us.
  • Same old problem

    It's always the same old problem. If you make it small you can't see it or operate it. If you make it big it's ugly and uncomfortable. These are ergonomic issues and not technological ones. I don't even wear my wrist watch anymore now that I always have the time on my phone.
    Buster Friendly
  • oh the ugliness

    of the smart watches. One uglier than the next.

    The white one shown at the top of this page looks like it was designed as a female watch and then hasty scaled up and became a male watch.

    And of course all shown models are for males, even when they pretend to be 'unisex'. The reason is that female's wrists are mostly thinner, and the design just can not get any smaller than it already is.
  • Apple will be releasing Female and Male versions of the iWatch

    It's ridiculous that Samsung, LG and presumably Motorola won't release female versions. It opens the door for Apple to shine again.