Facebook is expanding its presence in the wearable tech market but faces several obstacles to success. Until recently, Facebook’s wearable tech offering was focused on virtual reality (VR) headsets, following its 2014 acquisition of Oculus VR for $2bn.
However, VR is still a niche business, so Facebook is diversifying into smartwatches and smart glasses. The company is incorporating futuristic concepts into its products. However, tough competition and Facebook’s tainted reputation on data privacy could limit its success in the short term.
Facebook faces intense competition in wearable tech
Facebook is planning to launch its smart glasses by late 2021. It is working with Luxottica and could incorporate technology from CTRL-Labs, which it acquired in 2019.
Facebook has previewed a wristband that uses electromyography, a non-invasive neural interface technique used by CTRL-Labs. It translates electrical activity generated in the nerves into digital commands. This means that users could potentially operate the smart glasses by thinking about an action (e.g., moving your hands to scroll down a webpage) or by making a gesture (e.g., moving a finger vertically downwards). Facebook aims to use this technology to change the way people communicate with smart devices.
The first iteration of Facebook’s smart glasses will not include augmented reality (AR) capabilities, although they will be present in later versions. The first-generation smart glasses will come in multiple designs and feature AI, spatial audio, and a built-in camera. Presumably, the lack of AR will help keep prices down, but widespread adoption will depend on the available use cases. Facebook has yet to shed light on what these will be.
Facebook’s smart glasses will enter a niche market that has seen several high-profile failures in the past, most notably Google Glass. It will also be joining the market at around the same time as Apple, which will launch its AR smart glasses by 2022. Apple’s leadership in AR, experience with wearables, and reputation as a privacy-focused company make it a significant threat to Facebook. Google and Vuzix are also focusing on the consumer market and will also limit Facebook’s growth.
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In smartwatches differentiation is paramount
In 2019, Facebook reportedly attempted to acquire Fitbit, which has since been bought by Google. It is now planning to launch a smartwatch featuring cellular connectivity, instant messaging, and fitness tracking capabilities.
The device will run on Google’s WearOS when it launches in 2022, but Facebook expects to have moved to a custom operating system by 2023. This will allow it to control the app library and reduce its dependence on Google.
The smartwatch is likely to integrate Facebook-owned apps, such as Messenger, WhatsApp, and Instagram, and work with fitness equipment from Peloton. The smartwatch is expected to be priced in the same bracket as devices offered by Fitbit, Huami, Huawei, and Garmin. However, much of its success will ride on Facebook’s ability to gain consumer trust.
Convincing regulators and consumers will be a battle for Facebook
Data privacy regulators are increasingly scrutinizing wearables vendors to prevent misuse of consumer data. Facebook has a reputation for taking insufficient measures to protect data privacy, receiving a $5bn fine from the US Federal Trade Commission (FTC) in 2019 for violating consumers’ privacy.
Facebook’s success in the wearable tech market will be tempered by concerns over its trustworthiness in the short-term. Many potential customers will be wary of sharing their data with the company.