IMS: Global wearable computing market is expected to reach $6 billion in 2016

May 13, 2013, according to foreign media reports, as technology matures, wearable computing devices have become a new battlefield for major technology companies to compete - Apple and Samsung, two giants, are working on the development of smart watches, while Google hopes to further improve the network-connected smart glasses. Many application developers have heard the news and hope to occupy a place in this new ecosystem.

According to a report by IMS Research, the global wearable computing device market will reach $6 billion by 2016. In order to seize this market early and take a leading position, Evernote and other companies have taken the lead. At the Redwood headquarters, more than 20 engineers in this cloud note application company are working on the development of wireless watches, heart rate monitors and Google smart glasses.

"You can compare these technologies to the success of smartphones," Evernote CEO Phil Libin said in an interview. "In the first two or three years, this was a niche market, and now it's the same with wearables. But in the next three to five years, this area will generate significant revenue. This is a long-term investment."

Currently, Evernote's revenue mainly comes from PC, tablet and smartphone software. Libin said that with the development of wearable computing devices, this pattern may change.

Juniper Research, a market research company, predicts that 70 million internet-connected wearable devices will be sold in 2017, compared to only 15 million this year. Currently, most of these devices on the market are sports monitoring instruments from sports and health brands such as Nike and Fitbit. But in February this year, an insider revealed that Apple had created a research and development team to test the waters in this field, and in March, Samsung also said it was developing smart watches.

Wearable computing

As the variety of devices increases, more and more consumers will download applications, which also gives developers an opportunity to make money through paid advertising and other payments.

“Once you create a product that appeals to consumers, you can grow very quickly,” Will Stofega, an analyst at research firm IDC, said in an interview.

However, if the predictions do not come true, the market's enthusiasm for wearable devices will fade. There are many possibilities that the bubble will eventually burst. Because these devices can take pictures or collect videos without others noticing, new applications are likely to raise privacy concerns. At the same time, if developers want to pull consumers who use smartphones and tablets to the wearable device camp, they need to make their products as outstanding and competitive as possible.

Early signs show that consumers are ready to embrace wearable devices. In March, a survey by ChangeWave Research showed that about 19% of 1,713 North American respondents said they wanted to buy Apple's iWatch. Similar data was reported before the launch of the Apple iPad.

App spending

According to a research report by technology consulting firm Endpoint Technologies Associates, if 40 million wearable devices are sold in the next five years, the market for developers could be as high as $400 million, based on the current $10 monthly spending patterns of iPad and iPhone users. Advertising revenue and in-app payments will help revenue exceed $800 million.

Last year, the Online Publishers Association, a market research firm, reported that 42% of iPhone users and 19% of Android users spent $1 to $20 on apps in a year.

Venture Capital Support

Google Glass is still the leader in wearable computing devices and plans to release it this year or next. To attract software developers to Google Glass, the Internet giant announced on April 10 that it will work with Andreessen Horowitz and KPCB to further expand the application library.

They have created a group called Glass Collective, optimistically predicting that the glasses platform will grow into a new arena for third-party developers, replicating or even surpassing the successful mobile application ecosystem of Apple iOS. This investment company will sponsor startups that develop new uses for Google Glass, covering entertainment, education, healthcare and other fields.

For companies that already have smartphone and tablet apps on the market, developing apps for wearable devices is not difficult. David Kincaid, founder of Design LLC, the developer of the golf app FreeCaddie, said porting existing smartphone apps to these new devices might only take "a few hours."

Engaging Experience

David Kincaid's company has designed an app for Pebble Technology's smartwatch that displays key statistics on a golf course.

In an interview with reporters, Jin Kai said, "This is really easy. Many people emailed me and said that such applications are needed on watches. If watches develop like smartphones, they will have huge potential."

Jason Jacobs, CEO of FitnessKeeper, the company that makes RunKeeper, said the company is working on an app for the Pebble watch that will display exercise and fitness data on the user's wrist.

"With wearable devices coming to market, anything that helps people make better everyday decisions is something that we're excited about," Jacob said. "It creates an engaging experience, and if we can attract more users, that's great for us." RunKeeper currently has 17 million users.

Touchstone

Some apps work only with a specific wearable device; some display functions on the user's smartphone; others can be used on smart watches or glasses; and some are web apps that can only be used when the device is connected to the Internet.

"It doesn't really matter where the apps are running," said Evernote CEO Phil Libin. "The real apps run on the device, and the other apps help identify the device."

Stofiga said that in the next one to two years, applications developed for Internet-connected home appliances, wearable computers, televisions, cars and other devices will generate commercial returns comparable to the current scale of mobile applications. According to a report by ABI Research, a market research company headquartered in London, UK, by the end of 2012, mobile applications had generated cumulative revenues of more than $30 billion.

For a wide variety of connected devices, the success of applications depends on whether the payment and shopping experience can be seamlessly integrated. Stofiga believes that developers need to determine the right business model and figure out what type of software may be popular on wearable devices. Some devices may have the last laugh, while other products can only be left behind.

Smaller development scale

“I’m not sure there’s a long line of commercial developers to build for this niche device yet,” said Roger Entner, an analyst at market research firm Recon Analytics LLC. “The first apps will probably come from hobbyists, maybe just as a hobby. Then commercial app developers will start to catch on.”

"The goal for most developers is to create apps that are aware of and compatible with all connected devices," Libin said. In March, Google demonstrated Skitch, an Evernote app that can share photos taken with Google Glass with a tablet. He also used the powerful Google Glass to add an emoji to a message on the private social network Path.

“I’m convinced that we are at the forefront of a new wave,” Libin said. “We are one of the first companies to test the waters in this space and we will be tested by the market. We believe that there are opportunities everywhere.”