Wearable tech is on the precipice of becoming an absolute must-have in everyone’s life. The concept has existed since the 1960s, when Casio released a watch that doubled as a calculator. It was not until the 2010s that companies started using the Internet of Things (IoT) to bring wearable tech into a new dimension. The release of Apple’s first smartwatch in 2015 broke new ground, creating a wearable tech craze where IoT was used to monitor a person’s activity and allow collaboration between several devices.
Consumer IoT, comprising three distinct markets (automated home, connected car, and wearable tech), will constitute 27% of global IoT revenue in 2022. Wearable tech will be the largest and fastest-growing segment by revenue in 2023, reaching a market size of $126 million.
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The wearable tech industry might struggle
In the first half of 2023, consumer spending on expensive, non-essential products—such as smartwatches and VR/AR headsets—will remain flat due to the looming threat of global recession, growing unemployment, and depleted disposable incomes. The situation will likely improve in H2 2023, provided the recession and supply chain disruptions stabilize. Customers will also demand more appealing use cases for wearables at affordable prices, such as holographic communication and remote asthma monitoring.
Secondly, there will be problems surrounding data privacy for wearable vendors. Wearable devices generate massive volumes of personal data from users, including biometrics, location, email passwords, app activity, and even recorded conversations. The increasing use of augmented and virtual reality (AR and VR) devices for the development of the metaverse will only add to the data volume and variety. The data will be stored in cloud servers, which are already vulnerable to hacking or potential misuse by advertisers and vendors. Thus, actions such as the use of consumers’ personal data for profiting, or the inability to protect user data from being illegally accessed, will increasingly be treated as unethical for any vendor. This will threaten their commercial success, impact investor confidence, and invite regulatory scrutiny. For this reason, investment in data privacy will be absolutely essential for these wearable vendors.
A new wave could be imminent
Wearable tech will play a pivotal role in the development of the metaverse, which is expected to develop massively in the coming years. To experience the true metaverse, virtual goggles are necessary, with this technology being at the center of many companies’ plans—such as Meta with their release of the Meta Quest Pro. It is expected in 2023 that VR-based collaboration and training will become important use cases for emerging enterprise-grade metaverses. Companies are going to be forced to use headsets for task-specific uses such as employee onboarding, virtual events, and collaboration. Investment in headsets and VR will be essential in 2023 as they are a critical enabler of the metaverse, a mega-theme that is going to revolutionize digital media.
Overall, along with most other industries, it will be difficult for wearable tech to increase demand during the economic crunch. Households will be saving money instead of buying these new products. However, the growth of this industry means that there is now a variety of wearable tech products using IoT, ranging from smart jewellery to smart implantables. Many of these offerings can be used to save lives and, with companies such as Neuralink with their nanotechnology and Garmin with their updates on smartwatches improving fitness, it is expected that wearable tech will remain unaffected by this economic downturn.
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