Canada markets open in 51 minutes
  • S&P/TSX

    -120.22 (-0.61%)
  • S&P 500

    +0.98 (+0.02%)
  • DOW

    -68.63 (-0.20%)

    +0.0016 (+0.22%)

    -0.57 (-0.61%)
  • Bitcoin CAD

    -329.43 (-0.91%)
  • CMC Crypto 200

    +7.46 (+1.33%)

    +2.50 (+0.13%)
  • RUSSELL 2000

    +17.29 (+0.98%)
  • 10-Yr Bond

    0.0000 (0.00%)
  • NASDAQ futures

    -5.50 (-0.04%)

    -0.09 (-0.49%)
  • FTSE

    -17.65 (-0.23%)
  • NIKKEI 225

    -499.38 (-1.54%)

    +0.0033 (+0.47%)

Samsung Galaxy Gear: The wearable war is just beginning

Samsung Galaxy Gear: The wearable war is just beginning

If you wear it, they will come.

At least that's what major hardware vendors, stung by flatlining PC sales and increasing competition in the mobile space, are hoping. With Samsung’s announcement Wednesday of its Galaxy Gear, the race to be top dog in the fast-expanding market for so-called smartwatches is officially on. Samsung isn’t alone: Sony, Qualcomm, MetaWatch and one-time-Canadian startup Pebble are all racing to be first on consumers’ wrists.

Smartwatches are part of a broader category known as wearable computing. If these devices aren’t wrapped around a wrist, they’re perched on your face, with heart rate monitors, accelerometers, GPS units and a host of other sensors generating a never-ending stream of data from the wearer’s everyday activities. Google Glass made waves following its launch earlier this year, with viewing parties and demos attracting attention from the digital elite.

The race to be first

For Google and other companies like Toshiba, Acer, and LG, the clock is ticking: Apple, which applied for the iWatch trademark registration in Japan in July, is rumoured to be aiming for a 2014 release. Samsung’s announcement, deliberately timed to steal Apple’s thunder before its expected next-generation iPhone reveal on September 10th, underscores the importance of timing in this ever-accelerating market.

Samsung’s $299 U.S. device continues a trend for wearable devices that began with fitness-oriented offerings from Nike, Jawbone and Fitbit. The FuelBand, UP and Flex, respectively, are basic, screen-less bracelets that sync to a computer or smartphone and provide a quick, relatively inexpensive – they typically retail between $100 and $200 – means of collecting detailed workout data for analysis and sharing via social media. Further up the wearable food chain, Nike’s SportWatch and similarly sport-focused watches from Garmin and Timex combine GPS receivers with linkable, sharable apps.

Power, price could stunt demand

For all the hype, there’s no guarantee that wearables will become computing’s next big thing. For one, the engineering isn’t quite there yet. Stuffing a device with enough sensors to be useful, a screen large enough to be visible, and a battery large enough to power it all often results in clunky, oversized designs that barely qualify as fashionable or even practical. While the best smartwatches may last a few days in between charges, some wearables, like Google Glass, can start to lose their volts by mid-afternoon – a critical limitation that smartphone users are already familiar with.

The dependence of wearables on mothership devices – usually smartphones, but also, and less conveniently, tablets – can also limit their appeal. Research firm comScore put smartphone penetration in Canada at 62 per cent as of year-end 2012 (up from just over half in December 2011), leaving 38 per cent of consumers unable to get the most out of a wearable device even if they’re inclined to buy. The limited compatibility of current devices – the Galaxy Gear only syncs with a few, Samsung-only phones and tablets – further constrains demand.

Price remains another barrier. While the $149 Pebble is close enough to the psychological discretionary purchase range, the $300 level where most early, big-name offerings live is clearly targeted at early adopters willing to roll the dice on something new.

Billions at stake

The race by top-tier vendors like Samsung and Sony – whose second-generation SmartWatch 2 goes on sale this month – to beat Apple to the punch underscores what’s at stake. UK-based IMS Research estimates the wearable computing market will be worth $6 billion globally by 2016. Juniper Research projects wearable sales will rise from 15 million in 2013 to 70 million by 2015.

The dream of Dick Tracey-like communication may finally be here. Whether consumers are willing to overlook the near-term limitations remains to be seen.

Carmi Levy is a London, Ont.-based independent technology analyst and journalist. The opinions expressed are his own.