Time for a Reality Check on Android Wear

time-for-a-reality-check-on-android-wear

Over the last few days, there has been a lot of talk about Android Wear sales, or the lack thereof. Interestingly, people have figured out how to get ballpark numbers for Android Wear smart watches by using Google Play download estimates. These estimates don’t give us an exact figure, but they provide a good general indication of how Google’s flagship wearables platform is doing. The data suggest that only between 500,000 and 1 million Android Wear watches have been sold so far.

Let’s dissect these numbers a bit more and get some context around them.

Google’s Android Wear platform was officially announced in March 2014 along with a developer preview. At Google I/O in June 2014, developers got their hands on the first watches to be released on the platform, namely the Samsung Gear Live and the LG G Watch. Today, there are six watches available on the platform, and we have more expected to come on board at MWC 2015.

  • The Moto 360, which released in September 2014, has been the best-selling watch so far according to most estimates, including those of Tractica.
  • Samsung has not favored Android Wear and has chosen to go with its in-house Tizen platform for five of its six smart watches.
  • LG has the G Watch and G Watch R, which released in 2014, both of which look quite similar.
  • The Asus Zen watch has surprisingly not fared well and the Sony Smart Watch 3 was only released in November 2014.

While most of these watches only had a few months of retail shelf life in 2014, one would have expected Christmas to boost sales. After all, there was a lot of tech and media coverage around these watches, especially the Moto 360, and so one would have expected the overall shipments to be closer to 2 million, taking into account the multiple brands that were doing the marketing and the global footprint in which these companies operate.

What makes the figures even worse is that the actual number of watches in active use might be even lower, as I have anecdotally heard many Android Wear users abandoning their watches after the first 3 to 6 weeks, similar to what we see with fitness trackers. In addition, this number could also include casual downloaders who got the app but not the watch. Also, many of these watches were given free to Android developers at Google I/O 2014, and a number of these are likely to have been purchased by developers to develop or experiment with applications.

Overall, this doesn’t look good for Android Wear and Google, especially when you compare it to the competition. According to Tractica’s latest estimates, soon to be published in our upcoming report on Smart Watches, the smart watch market has grown from 2.2 million units in 2013 to 5 million units in 2014, showing a growth of 150%.  Tractica has also compiled numbers around smart watch OS share and sees Samsung’s Tizen dominating the share in 2014 at 44%, followed by Pebble-type embedded OS watches at 23%, standalone Android at 18%, and Android Wear in last place at 15%.

Smart Watch Market Share by OS, World Markets: 2013-2020

Smart Watch OS Share

(Source: Tractica) 

In addition, going forward from 2015, Apple’s WatchKit is expected to dominate the market and therefore things will get tougher for Android Wear. Samsung will continue to put pressure on Wear with Tizen, and competition will heat up with Apple coming in later this year. Also, standalone Android could get a boost in China if Xiaomi launches a smart watch in 2015, which we believe is highly likely.

So, why hasn’t Android Wear caught on so far while other platforms have? Here are some possibilities:

  1. Lack of “wow” factor in any of the watches. While Moto 360 did have some initial buzz, there seems to be some tempering of expectations.
  2. Battery life with Android Wear could be an issue. I don’t see this as specifically an Android Wear issue. Tizen should have the same issues, but they seem to have sold many more watches.
  3. Lack of applications on Android Wear. This could be a major issue. If Google hasn’t managed to garner support in the Android developer community since its launch in June 2014, then this could be an uphill climb. Tizen has managed to launch 1,000 apps in the meantime on their smart watch platform.
  4. The platform needs more time to develop and mature as more devices come on board and new software features are introduced. There are many devices on offer but none that are compelling. Android Wear is still waiting for a “hero” device, which will drive the market. Moto 360 comes closest to being one, but it’s unrealistic for it to ship as many as Apple would or even Samsung has until now.

If Android Wear is to succeed in this market and grow share, it has to differentiate through software rather than hardware, especially around contextual awareness. This is Google’s big differentiating feature from Apple when it comes to wearables, something that I raised in an earlier blog post as well. Apple has chosen to market its smart watch as a fashionable, well-designed timepiece that has a compelling suite of applications. However, Apple lacks a contextual platform like Google Now, which forms the backbone of Android Wear. Google has to put its weight behind its Android developer community to start developing contextual applications or using existing Android smartphone applications and giving them a contextual avatar in Wear. We have yet to see any true compelling contextual applications on Wear yet; although Google has tried hard to market it as a contextual platform.

In reality, this market is likely to take longer to mature, with the initial few years all being about “hero” devices and looks. The software and the developer ecosystem will need time to truly understand and take advantage of contextual inputs. We also need machine learning to start playing a bigger role in smart watches, but that too needs time and has a learning curve of its own.

I am beginning to think and believe that smart watches and wearables on the whole have a much longer lifecycle compared to what we have seen with the smartphone or tablet markets. Expect this to play out over a 10-15 year span rather than a 5-7 year span.

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