Home > Latest News > Smartwatches Leading Wearables Revenue Share, Smartglasses Growing

Smartwatches Leading Wearables Revenue Share, Smartglasses Growing

Smartwatches are commanding the larger share of wearables revenue, with global wearable device wholesale revenues expected to grow 31 per cent this year, according to Strategy Analytics.

In terms of units shipped, fitness bands will lead worldwide, however their average selling price will be held back by continued strong sales of Xiaomi and other ultra-low-cost bands in Asia, Strategy states.

Strategy forecasts that by 2022, total wholesale wearable devices revenues will top US$45 billion, driven primarily by smartwatches, aided by the major operating systems and their sponsors.

“Despite declining smartwatch prices and the growing impact of smartglasses offering more understated designs by 2022, analysts predict smartwatches will still command more than a 50 per cent share of both wearables volume and value,” Strategy states.

strategyStrategy forecasts that in 2016 smartwatches will command a 62.4 per cent global wearables revenue market share, followed by fitness bands with 27.1 per cent and smartglasses with 8.2 per cent.

“Improved usability and ecosystem momentum from next-gen platforms like watchOS, along with greater consumer choice around style, fashion and standalone connectivity all bode well for smartwatches,” Strategy analyst Steven Waltzer commented. “Smartwatches will capture 62 per cent of global wearable revenues in 2016, peaking in 2017 as smartglasses, clothing and jewellery begin to gain steam.

“For smartwatches, the ability to run third party applications is at the core of what makes the device ‘smart’, and the ecosystem of app developers is paramount in the effort to discover new killer use-cases beyond notifications and activity tracking.

“Smartwatches are currently dominated by the mid-tier (US$100-499 wholesale ASP), which is projected to account for 80 per cent of smartwatch shipments and 51 per cent of smartwatch revenues in 2016.”

Cliff Raskind, Strategy senior director, noted that Fitbit’s Blaze and Alta “have done remarkably well in developed markets to grow the high-tier US$100+ fitness band segment that accounts for roughly three of every four bands sold”.

“In contrast, an ASP of scarcely US$30 in Asia will serve to suppress global revenues,” Raskind observed.

“Over the long term, we expect fitness/health/sports bands to plummet to 2 per cent of total wearables revenues by 2022 as more affordable, open OS smartwatches proceed to cannibalise this segment. Betting on the long-term dominance of fitness bands is akin to putting all of your chips on feature phones a decade ago.”

Strategy states that the smartglasses segment will experience the most revenue growth through to 2022, estimating it will become the second largest revenue pool by 2022 behind smartwatches.

“Emerging technologies from R&D heavyweights like Zeiss and innovators like Lumus, coupled with major investment from eyewear powerhouses like Luxottica, point to the kind of quality, usability, affordability and fashion where smartglasses can be offered as an alternative to standard eyewear,” Strategy states.

“Simply converting 5 to 10 per cent of the world’s billion-plus eyewear users to smartglasses means an addressable market well into the tens of millions.”

While Strategy notes, by region, the Asia Pacific took the lead in wearables volume share last year, and will overtake North America in value share this year, that North America “is and will remain a key area for wearables during the next five years in terms of R&D, innovation, ecosystem development and commanding the highest ASPs”.

You may also like
REVIEW: Fitbit Charge 3 – Superb Simplicity
Fitbit Rolls Out New Update For Versa and Ionic
REVIEW: Yeelight Aurora Lightstrip Plus – Cheap & Cheerful
Puma Revives 1986 Smart Shoe
Fitness Device Market Booming In OZ Apple, FitBit, Samsung Big Winners