Photographer: Michael Nagle/Bloomberg

Why the Smartwatch Hype Machine Is Running Five Years Fast

Too much, too soon?

Here’s why you probably want a smartwatch: You can use it to do cool stuff like open doorspay for coffee, and start cars. Here’s why you probably won’t buy one for another five years or so: There still aren’t many doors, stores, or cars that your smartwatch will work with.

At the IFA electronics show in Berlin this week, Samsung Electronics Co., Lenovo Group and Huawei unveiled updated watches with upgraded features like tap-to-pay and the ability to interact with other devices ranging from your cell phone to your thermostat to your minivan.  

The new Moto 360 smartwatch 
The new Moto 360 smartwatch 
Source: Motorola

The stumbling block is that it will take several years before there are enough sensors in homes, businesses and vehicles to make it worth the trouble to strap on a smartwatch.

“For watches to become more popular and more mainstream, they have to deliver a number of capabilities to be relevant,” said Andy Griffiths, head of Samsung’s U.K. and Ireland division. “Our expected timeline is out to 2020.”

The likes of Samsung, Intel Corp. and Philips NV are doing their part to create the ecosystem, rolling out home sensor kits that control thermostats, lights and appliances from a smartphone, and pushing for the deployment of mobile payment systems.

The hurdles are formidable. At IFA, Intel demonstrated wireless charging plates that can be fixed under desks or tables to charge devices, but said the system won’t be available until the end of next year at the earliest.

The Samsung Gear S2 smartwatch can unlock your car and pay for your coffee
The Samsung Gear S2 smartwatch can unlock your car and pay for your coffee
Source: Samsung via Bloomberg

“We are having to invent this from scratch,” Kirk Skaugen, Senior Vice President of Intel’s Client Computing Group, said in a presentation announcing the initiative.

Meanwhile, new watch makers are crowding the market. Gartner Inc. estimates that about 40 million of the devices will be sold this year. While tech companies will sell 40 times as many mobile phones as watches this year, smartwatch sales will see an eight-fold increase, Gartner says.

Apple’s smartwatch, which went on sale in April, is expected to account for about half of 2015 sales, Gartner analyst Annette Zimmermann said. There will also be an “avalanche of Chinese vendors” selling scaled-down smartwatches for as little as $30, mostly in China, which will account for a growing share of the market.

“The question is always, ‘How quickly are people going to change?”’ Zimmermann said. “It does seem like a convenient thing if you go out for a run with your Apple Watch, you don’t have to take your phone with you, and on your way back you can even go to Starbucks and buy something without your wallet or your phone. But it requires a change in behavior.”


 Prepare Your Wrist

Some of the latest smartwatches to watch:

  • Samsung Gear S2: Can be worn while swimming; Uses Tizen, Samsung’s new operating system
  • Sony SmartWatch 3: Voice-controlled device has built-in GPS and is water resistant down to 4.9 feet
  • Apple Watch: The market leader; Read e-mails, summon Siri and make and receive phone calls from your wrist
  • Huawei Watch: Swiss timepiece-inspired design with circular face has a built-in heart rate monitor and six motion sensors
  • Motorola Moto 360: Comes in men's and women's versions; tracks your steps, calories, and heart rate
  • Asus Zenwatch: Includes designs for more than 50 watch faces and an app that lets you make your own. 

With assistance from Nate Lanxon in Berlin

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