Excitement Over Wearables at CES is Justified but Beware of the Hype, Says Analyst Firm CCS Insight
- Smartwatch market presents biggest opportunity in wearables over next few years
- “Gadget bling” purchases justified under guise of health and fitness
- Ambitions for Google Glass need to focus on the longer term
3rd January 2014, London, UK — Navigating the hype is the biggest challenge facing companies targeting the wearable device market in 2014, according to analyst firm, CCS Insight.
Ahead of International CES in Las Vegas which takes place next week, the company warns the wearables market is in a phase of frenetic and chaotic development.
Ben Wood, the company’s chief of research, said: “The $100 million invested in wearables through crowd-funded efforts such as Kickstarter proves this is a category with explosive growth potential.
“While this approach will undoubtedly produce some stars, many wearable devices will have their five minutes of fame at shows like CES before disappearing into oblivion.”
More observations from CCS Insight
Smartwatch market presents biggest opportunity in next few years
CCS Insight believes the first explosive growth in wearables will gravitate towards wrist-based devices as this is the most commonly accepted place to wear technology. The major stars in this smartphone companion area will be smartwatches which have the potential to reach sales of 12 million units in 2014. Echoing the dramatic growth pattern seen with tablets, the company believes that in an optimistic scenario sales could rapidly rise to over 100 million units in 2017 as prices crash.
Gadget bling purchases justified under guise of health and fitness
The success of products like Nike’s FuelBand and Jawbone’s Up have shown there is a considerable market for wearable devices targeting the “worried well”.
Mr Wood said: “Personal health and wellbeing will be important factors in all wearable devices as consumers try to rationalise buying ‘gadget bling’ under the pretext of it improving their health and fitness.”
CCS Insight predicts sales could reach 36 million units in 2017 for what it terms “quantified self” products such as fitness bands. But the firm also warns that smartphone companions like smartwatches with wider functionality could make pure fitness trackers redundant.
Ambitions for Google Glass need to focus on the longer term
CCS Insight is sceptical about the short-term opportunity for wearable Internet devices like Google Glass. They have captured the imagination of geeks but mass-market acceptance is years away. The company’s most optimistic forecast for this category is less than 10 million sales globally in 2015.
Today’s wearables market is like the mobile phone market in the 1980s
Mr Wood said: “Technology companies are currently feeling their way in the dark, but we expect innovative features to appear first on wearable devices that will end up being integrated into smartphones and other consumer electronics devices.”
About CCS Insight
CCS Insight is a global telecommunications analyst company. It provides comprehensive services that are tailored to meet the needs of individual clients, helping them make sense of the connected world. Follow us on Twitter or learn more at https://www.ccsinsight.com.
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