The smart phone has been around for several years now and has matured significantly since the days of the original iPhone.  Is it just me or does the market seem to be getting saturated?

The likes of Samsung, Apple, Google, Nokia and HTC are pumping out new models on a yearly basis.  With all of these devices floating around out there, it was inevitable that a new product category would arise.  Enter the smart watch.

As the name implies, this new gizmo would be more than just a watch.  Imagine a mini smart phone that sits on your wrist that can be configured for various purposes and supports apps.  According to ABI research, 485 million of smart watches could be sold by 2018.

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Smart Watches: Next Big Thing?

Though this gadget has been making a lot of headlines recently, smart watches have been around for awhile.  The Nike Fuel Band has been on shelves for a few years and has some limited smart watch like characteristics.

Sony also has a smart watch that they released in 2012 which needs to be connected to an Android based phone.  Their offering lets you check Twitter, the weather, read SMS messages and more.  Reviews on the Sony offering are good but not great.

Another up and coming product is the Pebble, a very full featured, customizable watch.  You can change the watch face (analog, digital), use it as a bike computer or even a golf range finder.

$150 for a mini computer on your wrist is probably not a bad price if you utilize all its capabilities.  One of the best features is the ability to write code for Pebble and distribute it to the community.  There’s nothing better than having an army of geeks writing apps for your product for free.

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While these initial offerings may be good, they’ll need to watch out (pun intended) for tech giants like Apple and Samsung.

Apple has long been rumoured to be making a smart watch and Samsung just came out and said they are making one too.

Hopefully a new product or two like the smart watch and an Apple TV will turn Apple’s stock around after its tumble in recent months.  Note: I am an Apple shareholder though I sold 50% of my shares when the stock was trading at $660.

While a smart watch may be the next big thing in tech gadgetry I think we need to dial down the hype a little bit.

How many of you remember the old Casio calculator watch?  How many people did you know that wore one of these things?  Sure you could use it to figure out the tip on a restaurant bill but this type of watch was lacking one major thing, the cool factor.

Watches are meant to be cool

For many people, a watch is far more than just a clock on your wrist.  A watch is a fashion statement, a piece of jewellery or even a symbol of success.

A computer on your wrist does not embody these things.

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We have an expectation that watches should be durable and last a very long time.  With the pace of change in technology, we could see new smart watches getting pumped out every couple of years.  This runs contrary to the whole experience of owning a watch.

While I’m sure many tech or outdoor enthusiasts will pick one of these up, I’m not sure the mainstream public will have the same reaction.  There will be a market for smart watches but it will probably be more of a niche one than the broader smart phone market.

Would you wear a smart watch with a suit?  Doubtfully.  On a date?  Probably not.  In grade school?  Perhaps, but your teachers probably wouldn’t be happy about it.

If the likes of Samsung and Apple can make smart watches really, really cool, the product will do well.  Otherwise it will remain a niche item.

Remember, if you are already carrying one “smart” device, your phone, why would you need to carry another one?  Owning two gadgets that have a lot of overlap in terms of features isn’t a good use of resources.  The watch would have to offer a lot of different capabilities that your phone can’t.

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While I may be a bit skeptical on the perceived size of the market for high tech watches, I do see a big opportunity for companies if they can somehow produce a product that everyone wants.

Andrew Martin is a personal finance and investing blogger from Toronto, Ontario with a background in technology and a passion for travel.  His blog, She Thinks I’m Cheap aims to help Canadians make more money by sharing facts, stories and advice.

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13 Comments

  1. Robert on March 22, 2013 at 5:42 am

    I am not sure we have seen a smartphone or tablet yet that has quality to justify the price. But they sell a zillion every day, we assume they are necessities! People Logo power is such that millions throw out perfectly good phones every year to buy a new one displaying a fruit logo, even after Apple has fallen decidedly behind several peers in price and innovation.

    There will never be a logical reason for an average person to have a computer watch. This does not mean there there will not be billions sold. They will not need to offer features phones do not have. Smart phones just added low quality displays, cameras, and sound to a cell phone – we had high quality versions of all these for decades.

    Unfashionable? That won’t slow it down. Bluetooth convinced the hoards to walk around with pieces of plastic stuck on their ears. I think I am in the minority for still thinking they look ugly and unbearably geeky. A marketer will convince the world they are must-have fashion.

    • Andrew @ She Thinks I'm Cheap on March 22, 2013 at 4:30 pm

      Bluetooth has certainly evolved with time and become more mainstream. The driving laws that forbid holding a phone while operating a vehicle must have been a boon to the makers of these headsets. I’m in the same minority with you!

  2. Money Beagle on March 22, 2013 at 5:53 am

    I remember my old Casio calculator watch. I had forgotten who actually made it until you reminded me. That thing was boss but the problem was it beeped every time you hit a button and I think you couldn’t disable that, so they pretty much got banned from being allowed at school.

    • Andrew @ She Thinks I'm Cheap on March 22, 2013 at 4:26 pm

      I knew someone would remember these! I recall being blown away by the whole concept of a calculator built into a watch but you know what? I didn’t buy one.

  3. Bet Crooks on March 22, 2013 at 6:28 am

    As Robert mentioned above, I never thought Bluetooth would sell, but it has, so I won’t try to guess whether smart watches will or not.

  4. Koala on March 22, 2013 at 8:25 am

    I think it’s going to take quite a bit of pushing. I think most of their target demographic stopped wearing watches a long time ago. I don’t think they really want to go back to wearing them.

    • Joe on March 22, 2013 at 9:25 pm

      Agreed. I haven’t worn a watch since I got a BlackBerry in university.

  5. Rosemary Wells on March 22, 2013 at 10:27 am

    The future is voice technology……no gadgets……no keyboards……think of something like Capt Kirk used to tap “Beam me up Scotty”. Want the weather? Driving directions? Whatever you want, you just need to ask. I won’t be here to see this but I’m sure we are getting very close.

  6. VanLarry on March 22, 2013 at 12:25 pm

    Smart Watches? Smart marketing hype more like…

    If you really want to look at “smart watches” just look at existing companies that’s been doing watches for years. Timex datalink anyone? Casio? Sunnto?

    Overlooking the technical side of problems, (limited battery life, costs, etc,.) most watch companies have concluded this area is more or less a niche market. At least for the North American market. Casio for instance have produced a lot of tech watches that would fit the “smart watch” profile, but usually don’t sell them anywhere outside of Japan. Plus they’ve also concluded that not many people would want to buy watches at the $1000 range.

    For the record, yes I’ve owned “smart watches” before they were called that. I’ve mentioned the Timex Datalink line, which I do own several of their models. I don’t own any GPS or heart rate monitor watches. Too expensive, and I don’t need them for jogging. My most expensive watch is probably my travel watch, a Casio. It gives me barometer, temperature, and compass readings. Very handy, when you’re travelling because you need to know what to dress for weather and knowing your bearings saves you alot of time then waiting for your GPS to lock.

  7. Graham Roe on March 22, 2013 at 2:37 pm

    These will become as indispensable! I don’t think you’ve considered all the use cases, especially for the suits.

    Think of anytime its a pain pull out your phone:
    * Giving a speech, seminar / lecture
    * In a meeting
    * Spending time with a client, and you only want to be disrupted for a particular call / message
    * Driving
    * Taking public transportation
    * Anytime you’re sitting and your phone is in your pocket

    Probably the most valuable feature that will come from this technology and transfer to others are intelligent notification filters that can sense which notification you need to be aware of at that moment.

    I would say we’re seeing the end of the ‘smartphone’ era and the beginning of the mobile computing era —

  8. Bryan Jaskolka on March 29, 2013 at 2:03 pm

    I can completely see us at some point, purchasing smart watches. And yes, even thinking that they’re completely necessary.

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