In wearables, more questions than answers

SAN FRANCISCO--As interest grows in the wearables space, the current leaders in the market remain largely divided on how the segment will progress and where it is headed. However, most agree that the wearables space is poised to bloom.

qualcomm rob chandhok and htc phil chen

Qualcomm's Rob Chandhok, left, and HTC's Phil Chen discuss wearables during an event at the GMIC show.

"It's totally going to happen," said Paul Graham, co-founder of seed capital firm Y Combinator, here at the GMIC show, in response to questions on whether wearables will grow beyond the hype into an established, viable market. "Fads aside, it's totally going to happen. I just don't know when."

Qualcomm (NASDAQ:QCOM), the wireless industry's largest vendor of silicon, agrees. Rob Chandhok, president of Qualcomm Interactive Platforms and senior VP of Qualcomm Technologies, said that the company is investing heavily into the market for wearables.

"It's something that we're looking at really hard," he said, though he declined to provide specific figures. "We're optimistic that the market is going to grow quite large."

According to a new research report from the analyst firm Berg Insight, sales of smart glasses, smart watches and wearable fitness trackers reached 8.3 million units worldwide in 2012, up from 3.1 million devices in the previous year. The firm expects total shipments of wearable devices to reach 64 million units in 2017.

Indeed, Qualcomm is one of a large and growing number of companies stepping into the wearables space; the company last month announced its Toq smart watch. Samsung, Sony, Pebble and others also sell smart watches. Those rumored to be planning an entry into the smart watch space include Microsoft (NASDAQ:MSFT) and Apple (NASDAQ:AAPL). And perhaps the most polarizing wearables product comes from Android proponent Google (NASDAQ:GOOG), which plans to soon begin widely selling its Glass product.

"The really controversial part of Glass is how it affects social norms," said Bharat Vasan, COO of smart watch company Basis Science. Vasan explained that Glass contains features already present in other devices, such as a camera, but it isn't yet an accepted part of society.

Wearables "have to mesh with your existing life," said Eric Migicovsky, founder and CEO of smart watch vendor Pebble. AT&T Mobility (NYSE:T) recently announced it would sell Pebble's smart watch in all of its stores across the country. Migicovsky said that gaming will be a key application for wearables like smart watches: He said a chess app for Pebble allows users to play against each other via their watches.

Migicovsky added that Pebble is currently targeting users with smartphones (he said there are 1.5 billion people worldwide with smartphones), and he said the company is selling the Pebble smart watch as a smartphone accessory. Qualcomm's Chandhok noted, however, that there is currently no communication standard that allows watches to communicate with all the other devices in a user's life. That lack of interoperability could hurt the space, he said.

Phil Chen, chief content officer at HTC, said that HTC hasn't yet found a strong enough use case to enter the wearables market. Chen said that HTC's smartphones already provide many of the same services that today's smart watches offer. An HTC smartphone "is almost like a wearable. It goes where you go," he said.

Chen's stance on wearables was less enthusiastic than CEO Peter Chou's recent comments on the topic. In a recent interview with the Financial Times, Chou described wearables as a "critical" market segment for the company.

For more:
- see this Berg Insight release

Special Report: Is it time for smart watches?

Related Articles:
Inside Samsung's push to develop its Galaxy Gear smart watch
Samsung, Qualcomm announce competing smart watches: Galaxy Gear vs. Toq
Lowenstein's View: Wearables--hip or hype?

Sponsored by ADI

What if we were never truly alone? Our next-gen communications technology can help people in even the most remote places stay connected.

What if there were no ocean, desert, mountain or event that could ever keep us from telling our stories, sharing discoveries or asking for help? ADI’s next-gen communications technology could keep all of us connected.

Suggested Articles

AT&T has shifted its Cricket prepaid brand to a 100% authorized retailer model, according to Wave7 Research.

The FCC decided to extend the timeline for responding to Huawei's application for review until December 11.

All operators are trying to understand the intersection between their networks and hyperscale networks. But who gets the lion's share of the revenue?