Report: 40 Percent of Wristworn Devices Will Be Smartwatches by 2016

• By Joshua Bolkan
• 09/17/14

Forty percent of all devices worn on the wrist will be smartwatches by 2016, according to a new report from market research firm Gartner. That prediction follows a swell in the smartwatches available to consumers as the number of companies offering the devices has increased from just two a year ago to seven with a device either currently on the market or about to ship.

"Apple has finally unveiled its Apple Watch, which we expect to trigger more consumer interest once it starts shipping in 2015," said Angela McIntyre, research director at Gartner, in a prepared statement. "Apple introduced three smartwatch models that will sell at a wide price range, with the lowest starting at $349. As with the iPhone, Apple's high-price strategy for the Watch will limit its market share; yet, with its attention to design and the user interface, we believe this product will attract many users." 

Early products, such as the Sony SmartWatch and Samsung Gear, generated little "enthusiasm from consumers due to their unclear value proposition and flawed design," said Annette Zimmermann, research director at Gartner, in a news release. "In 2014 we are seeing a few more positive developments in terms of design and user experience (UX) and we therefore expect consumers to show more interest in these products in the second half of the year."

Zimmermann added that the newest devices feature improved design and provide glimpses of what Android Wear, the smartwatch version of Google's Android OS, can provide users.

Gartner also said it expects the "quantified self" movement, in which users track various data about daily activities such as food consumed, work productivity or blood sugar, to contribute to the growth of smartwatches.

Challenges that smartwatch makers will face, according to the company, revolve around batteries. In tests, smartwatches and wristbands reduce the battery life of the smartphones they're connected to by two to six hours, enough, according to the company, "to put off most users who use smartphones without an exchangeable battery."

The company also said that the number of devices that require charging in homes is expected to rise to the point that charging becomes burdensome, and though a more efficient battery would mitigate that issue, it would also force smartwatches to be too bulky for consumers.

"We are currently seeing two opposing trends in the market with regards to form factor evolution. On the one hand there are vendors offering smart wrist-wearables in a familiar watch-like form factor," said Zimmermann. "On the other hand in the past six to nine months, we have seen vendors launching products that resemble the early fitness wristbands, but come with displays that add significant functionality, including message and call alerts. These cross-over products are generally marketed as fitness devices, but with the strong slant toward the communication aspect."

Gartner also said that consumers can expect to see devices from Chinese vendors, those these will only be sold locally in the very near future.

"Products and offerings among Chinese vendors are similar to those of other vendors with a variety of form factors, operating systems, connectivity and sensor options," said McIntyre, in a prepared statement. "International expansion will start to accelerate in 2015 and in this context we expect several Chinese vendors to build on Android Wear in parallel to create more appeal. Certainly, they are faced with the same hurdles regarding design as all international vendors, but we also expect them to leverage one thing that has been to their constant advantage in the smartphone and tablet market: the cost advantage of the Chinese supply chain ecosystem. Chinese vendors might well be able to bring Android Wear based smartwatches to very affordable price points below $150 with decent designs and sensors — driving mass market adoption."