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The Lazarus Gadget

By Michael Castelluccio
October 1, 2019
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The words “smart watch” once simply meant a stylish timepiece. Then digital manufacturers, including several major ones like Apple and Huawei, decided to try their hand at wearables, replacing jewel works and mechanical gears with chips and batteries. They shortened the name to a single word, and, in 2015, Apple launched its flagship Generation 1 smartwatch.

 

It looked like the ultimate mobile timepiece. Digital watches first appeared with quartz works in the 1960s. Feature creep appeared in the 1970s when it was cool to get one of those Casio Databank watches with a calculator built right in. So, when Apple created a watch that added communications, could count the steps you took each day, recorded your heartbeat, and also gave you the official National Institute of Standards and Technology U.S. atomic time with an expected error rate of one second in about 100 million years, how could you lose?

 

DOOM—THE COUNTDOWN

 

But then the initial sales predictions fell short of expectations. It got worse. What looked like the slow demise of the smartwatch began to appear in fatalistic headlines on the tech blogs.

 

As early as February 2013, The New York Times and The Wall Street Journal were reporting Apple’s progress on its yet-to-be-released smartwatch. Seven months before the official fall release, however, CCG Consulting posted, “Wearables Were Doomed to Fail.” Concentrating on the fitness trainers and already existing smartwatches, the analysts noted that 90 million wearables were expected to ship in 2014, but the actual count was closer to 52 million.

 

The writers warned, “Apple is trying hard to paint the smartwatch as something brand new, but they look no more compelling to me. What can a smartwatch do that will significantly enhance my life if I am already carrying my smartphone?” The blog concluded, “Wearables in their current form don’t fit into very many people’s lives.”

 

Thirteen months after the Apple launch, Gizmodo posted a similar foreboding, “No One Is Buying Smartwatches Anymore.” It cited a major analyst to support the dismal situation. “The market intelligence from IDC reported on Monday that smartwatch shipments are down 51.6 percent year-over-year for the third quarter of 2016.” What it reported about Apple, the market leader, was even worse. Its numbers dropped 71.6%, shipping 1.1 million Apple Watches in Q3 2016, down from 3.9 million in 2015.

 

Jitesh Ubrani, senior research analyst for IDC Mobile, cast a long, dark shadow with a single sentence in his press release: “It has also become evident that at present smartwatches are not for everyone.” The IDC appraisal blamed the manufacturers because, “For all the promises of a smartwatch, actually living with one is often an underwhelming experience.”

 

In April 2017, the skeptics became more certain, and headlines that resembled epitaphs were showing up on sites like mashable.com. “Face it: Smartwatches are totally doomed.” Karissa Bell wrote the piece, and she began with the usual list of complaints about underperforming, buggy technology, and some downright ugly designs. She concluded, however, with an insight that others had mentioned but that she claimed was the essential, fatal flaw.

 

“These are all symptoms of the bigger problem with smartwatches, the one no one is talking about: watches, plain old analog watches, are dying a slow death and they are taking their ‘smart’ counterparts down with them.” If you’re a tech consumer, you likely have a smartphone. You probably check it very frequently, and the time and date appear on almost every page you tap to. Watches, smart and dumb, Bell concludes, are an expensive redundancy.

 

NICHE OR DIGITAL NECESSITY?

 

To be fair, there are indications that contradict this descent into oblivion.

 

In March 2019, Ge Li, writing in the Harvard Business School education website, posted a brighter outlook. Li opens with, “[The Apple smartwatch] became not only the most popular smartwatch but also the most popular watch in the world.” Support for the claim shows up in a bar graph showing that Apple shipped more watches than Switzerland in Q4 2017.

 

Two further indicators of a not-so-murky future is the release in September 2019 of the Series 5 Apple smartwatch and the long list of competitors featured at the 2019 IFA consumer electronics expo in Berlin, Germany. Fourteen smartwatches were debuted at the show to join eight other new models that were launched just weeks before the expo. Designers like Michael Kors (three new models), Emporio Armani, and Diesel on Axial joined the more recognizable names, including Garmin, Asus, and Withings.

 

Has the smartwatch entered the final stage of its evolution? It doesn’t seem so, especially given the possibilities for more sophisticated health monitoring, GPS tracking, and music and phone service. Will it serve only a select sector? That’s still subject to ongoing diagnoses.

 

Michael Castelluccio has been the Technology Editor for Strategic Finance for 24 years. His SF TECHNOTES blog is in its 21st year. You can contact Mike at mcastelluccio@imanet.org.


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