Wearables market to hit 237m devices by 2020
IDC expects wearable device market to more than double in shipments in next four years
The global market for wearable devices is set to reach 110 million units by the end of this year, and to more than double 237.1m devices by 2020, according to IDC.
The analyst company's Worldwide Quarterly Wearable Device Tracker predicts 38.2% growth in the market from 2015 to 2016, as more vendors enter the market and consumer awareness and demand grows. Double-digit shipment growth is expected to continue at least until 2020.
IDC also said that the introduction of different form factors and devices in the wearable sector would also contribute to the growth, with new devices offering new use cases and applications.
Watch and wristband shipments will reach a combined total of 100 million shipments in 2016, up from 72.2 million in 2015. Other form factors, such as clothing, eyewear, and hearables, are expected to reach 9.8 million units in 2016 and will more than double their share by 2020.
"Although smartwatches like the Apple Watch or Android Wear devices capture the spotlight, they will only account for a quarter of all wearables in 2016 and will grow to about a third by 2020," said Jitesh Ubrani, senior research analyst for IDC Mobile Device Trackers. "It's time to start thinking about smarter watches - traditional watches with some sort of fitness or sleep tracking but are unable to run apps - built by classic watch makers. These devices have the potential of making the technology invisible while still integrating themselves within day-to-day activities.
"By creating smarter watches, vendors also stand to side-step some of the typical challenges that smartwatch platforms face," added Ubrani. "There's no need to create a developer or app ecosystem for one thing, and there's plenty of room for simpler devices that appeal to the average user while smartwatches continue catering to the technophiles."
Meanwhile, smartwatches with an app ecosystem - like Apple's watchOS and Google's Android Wear - are expected to gain further salience in the market as both products and experiences evolve. "With few exceptions, this part of the smartwatch market is still in its initial stages," said Ramon Llamas, Research Manager for IDC's Wearables team. "We expect to see major changes, with smartwatches that actually look like watches, user interfaces that are easier than swipes and gestures, applications that rival those on our smartphones, and connections to networks, systems, and other devices. This puts pressure on smartwatch platforms to develop further from where they are today."
In terms of operating system share, IDC expects Apple's watchOS to maintain the largest single share of market, going from controlling almost half of all device shipments in 2016 (49.4%) to 37.6% by 2020.
Android Wear will control second place, with 21.6% share this year going to 35% by 2020, driven by an expanding eco-system of vendors, although IDC says that Google's decision to limit UI differentiation will stifle further growth and possibly force vendors to compete more on design and price. Android-based smart watches and Android Wear devices combined will control 40.2% of the market by 2020.
Real-Time Operating System (RTOS) - primarily used as a proprietary operating system but capable of running third-party apps - will become the third largest smartwatch OS, largely driven by gains in emerging markets and its use by Chinese ODMs. RTOS is expected to double its share from 5% of the market today to 10.1% in 2020. Appealing to consumers looking for a cheap alternative, RTOS devices will likely see relatively high adoption though the experience will be sub-par.