International Data Corporation (IDC) is a technology market tracking firm, and their analysts recently released their latest “Worldwide Quarterly Wearable Device Tracker” report. The company points out that the wearable industry as a whole hit the pause button in 2016, but their analysts are optimistic about the future. They see new form factors and growing retail channels supporting new growth worldwide.
Smartwatches will continue to capture the bulk of the wearables market while the “wrist band” devices will hold steady. Part of the growth in the watch segment will be due to greater differentiation as vendors pursue different types of customers for different model lines. The dedicated fitness band, on the other hand, has failed to expand their appeal much beyond their base market, and we can expect more smart watches to incorporate the features that consumers want from a fitness band.
Perhaps the most interesting numbers from this report, however, are the growth predictions. Granted, when you start at nearly-zero in unit shipments, any growth is going to look large, but the IDC forecasts predict a heady 77% compound annual growth rate (CAGR) over the five year forecast. That still only represents about 22 million units in 2021, compared with a bit more than 1 million in 2016, but it is impressive growth all the same. IDC analysts see smart clothing playing roles not just in fitness applications, but also for workplace safety and health monitoring. While not predicted to grow quite as dramatically, earwear (also called “hearables”) are forecast to have an impressive 43% CAGR, though this is based on modest growth from 700,000 units in 2016 to about 4 million in 2021.