Wearable tech? - it’s for the birds, cautions analyst (and the cows, and sheep...)

May 12, 2014 // By Peter Harrop, IDTechEx
Market analyst IDTechEx has issued a number of reports on the wearable electronics phenomenon, and is now working on a similar exercise covering the veterinary and other “non-human” wearables that may be in development. Ahead of that, the company’s Dr Peter Harrop offers this commentary on the emerging sector;

“Many giant electronics manufacturers, computer services companies and conglomerates have tens of billions of dollars in the bank that is instantly available for investment to counter their saturating sales in mature markets. Samsung, General Electric and Google are examples and Apple even has $133 billion available. They all seek "the next big thing", preferably one or more emerging, potentially-huge markets that can leverage the skills they have honed in such things as mobile phones and their services. Wearable technology has attracted their close attention as many of them have or are developing such technology and associated services and Google Trends has a graph headed heavenwards in the last few months to show that they are certainly not alone.

“In March 2014, Facebook announced it will buy Oculus VR, a Californian company which specialises in virtual reality headsets, for around $2 billion. Now Apple is negotiating to buy the company Beats Electronics for $3.2 billion, its biggest ever expenditure on a takeover. Beats is not huge: it has 27% of the $1.8 billion US headphones business mainly because of its premium pricing. Indeed, it has 57% of the premium sector of that market and it also has a music streaming service, both of which can leverage existing Apple offerings in wearable electronics.

“Facebook and Apple do not talk of paybacks, calling the investments strategic, probably meaning that they are proceeding regardless [of whether they anticipate making any money out of them]. Many of these huge "gut feel" investments also tick a box under newly hot topics overlapping wearable technology namely "Internet of People (IoP)" or "Internet of Things (IoT)". These devices are directly internet-identified now that IPv6 allows an effectively infinite number of IP addresses to be issued. IDTechEx predicts that as many as 55 billion IoP devices in use in 2025, many employing printed, flexible electronics and completely new components.

“Recently, Google has paid a strategic $3.2 billion for the small IoT/IoP company Nest Labs that has made a few million connected smart thermostats and smoke and carbon dioxide detectors. Nest hopes to earn more from selling measurement analytics than from the devices themselves. These devices detect and respond to personal needs just like much wearable technology where Google must have already committed at least $1 billion to the internal development of the exciting Google Glass, an experimental diagnostic contact lens for diabetics and a planned smart watch, all actually or potentially connected wearable technology - IoP.