Wearables on the up, but Apple Watch on the down

5 Dec 2016

Image: hurricanehank/Shutterstock

The wearables market is showing surprising signs of life, though Apple’s gamble on the Apple Watch may not have proved as spectacular as many first thought.

The Apple Watch was supposed to kick-start the wearables industry with stupendous growth, immense improvements and wave after wave of added consumers.

Sadly, this hasn’t come to fruition. Although the market has improved year-on-year, up a modest 3pc, Apple’s market share has fallen through the floorboards.

Apple Watch Fitbit Wearables

Apple shipped 1.1m units in Q3 2016, a drop of 2.8m devices, as its market share went from 17.5pc down to less than 5pc. While fitness wearables rise gradually, smartwatches fall fast.

“It’s still early days, but we’re already seeing a notable shift in the market,” said Jitesh Ubrani, senior research analyst for IDC. “Where smartwatches were once expected to take the lead, basic wearables now reign supreme.”

Fitbit is the dominant force, as it was pre-Apple Watch, with Xiaomi, Garmin, Apple and Samsung trailing in its wake.

“Simplicity is a driving factor and this is well reflected in the top vendor list, as four out of five offer a simple, dedicated fitness device,” said Ubrani. “Meanwhile, from a design perspective, many devices are focusing on fashion first, while allowing the technology to blend in with the background.”

Wearables Apple Watch Fitbit

Fitbit is having a good few months. Recently, it swooped in to buy the struggling smartwatch maker Pebble, for as little as $40m.

The Pebble smartwatch is regarded as one of the first great success stories of crowdfunding campaigns, and in particular, the beginnings of the Kickstarter website.

Despite millions of dollars of funding however, its value plummeted, with Fitbit’s purchase looking rather paltry in comparison to earlier interest.

“Smart wearables have been down in recent quarters, but clearly not out,” said Ramon Llamas, research manager for IDC’s wearables team.

“As user tastes change, so will their needs. That’s the opportunity for smart wearables with multifunctionality and third-party applications, both for consumers and business users.

“To get there, we need to see more intuitive user interfaces, seamless user experiences, stand-alone connectivity, and applications that go beyond health and fitness, and into personal and professional productivity.”

However, it’s not all rosy in the fitness tracker garden, with the gradual rise pretty small for a market so young.

Apple will bring out more watches, Fitbit will improve its various products, but an industry once thought of as a capable heir to smartphones is but a drop in the ocean at this point.

Gordon Hunt was a journalist with Silicon Republic