CES: Wake me up when wearables are so smart I can leave my phone at home

Phil Goldstein

LAS VEGAS--If you thought that wearable computing had a big presence at last year's Consumer Electronics Show, you would have been floored by the array of wearables announcements at 2015's CES. But, despite all of the hoopla and hype, I'm still unconvinced wearables will be a mass market phenomenon until they have more embedded cellular connectivity and, more importantly, greater intelligence so that they actually bring value to consumers.

I don't own any kind of wearable (confession: I've also never purchased a tablet). That's because I find that my smartphone provides more than enough utility for me. Smart watches specifically strike me as still just a mirror for the content on phones--and really, how hard is it to pull your phone out of your pocket or purse?

I'm not denying that there are uses for FitBits, Pebble watches or Android Wear devices. Fitness trackers in particular serve specific, discrete functions and tend to do those well, depending on the model. My point is that such devices are not nearly compelling enough to justify the purchase if one does not have the discretionary income, and will not be compelling until they become a lot smarter.

That has not stopped technology companies and device makers from unleashing a torrent of wearables here at CES. Here is brief, partial rundown of some of the announcements this week (thanks in part to CCS Insight):

Let's focus on the Intel announcement: Curie is an interesting concept, because it opens up a wide range of objects that can become connected. However, just because a wearable object is connected doesn't make it intelligent, or for that matter provide value to consumers.

Jeff Bradley, AT&T Mobility's (NYSE: T) senior vice president of devices, told me the carrier is going to heavily focus on bringing embedded cellular connectivity to wearables, something that AT&T Mobility CEO Glenn Lurie is passionate about. AT&T obviously would benefit from more devices that connect to its network, but Bradley pointed out that wearables will only become truly valuable when their battery life and connectivity are such that a person will not need to rely on a smartphone to stay connected. "I think the breakthrough comes when I can leave my phone behind and not have much of a tradeoff," he said.

AT&T is working with partners like Qualcomm (NASDAQ:QCOM) to make that happen. However, Bradley also said that wearable operating systems need to become smarter, and that digital assistants like Google Now, Apple's Siri or Microsoft's (NASDAQ: MSFT) Cortana need to evolve on wearables such that they are proactively helping people throughout their day by knowing what their meetings, workout habits and movement patterns are, and offering advice. "As we move away from a reactive relationship to a proactive relationship, the watch becomes more valuable," Bradley said.

There are several reasons why we're not there yet and likely won't be for another 12 to 24 months, said Julien Blin, president of Gizworld.com. "What's missing is more intelligence and stronger algorithms to make sense of the data" coming off wearables, he said, so your smart watch tells you how much weight you need to lose or when you are getting fatigued. That will require more consumers using wearables to generate a larger data set and create those better algorithms. Having more devices with embedded cellular connectivity will also help, he said.

Frank Lee, senior marketing manager for LG's U.S. mobile unit, told me that wearables will find greater success when network infrastructure is ubiquitous enough to support all-day use, even in underground areas like subway stations. He said that model already exists in markets like South Korea but will take time to develop in other parts of the world. I think that's an often overlooked aspect of this debate--if wearables are going to have embedded connectivity and not be tethered to a smartphone, they need to work just as well, if not better, as smartphones do in terms of connectivity.

Executives I spoke to from device makers agreed that wearables are still in version 1.0. HTC's president for the Americas, Jason Mackenzie, said wearables need to have an intangible cool factor to become mass market products. ZTE USA CEO Lixin Cheng added the company wants to make a wearable "that becomes a necessity, not a nice accessory."

Even Qualcomm President Derek Aberle, who is generally bullish on wearables, thinks the market is still in its infancy. "There's not going to be one right choice for wearables," he said. "I think in the next few years we'll see it consolidating, but it will take trial and error before we get there."

Wearables are still in version 1.0 and need to be smarter and more connected. Right now they are very much "nice to have," not "need to have." So let's tone down the hype. Wake me up when I can leave my home without my smartphone and just a wearable strapped to my wrist, because we're not there yet. --Phil

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