Wrist devices and face gadgets are experiencing a downturn, said research firm International Data Corporation, but don’t count them out just yet.
According to IDC, body-worn electronics such as smartwatches, augmented reality glasses and virtual reality goggles have reached a pivotal point in their evolution. Despite dips this year in shipments, analysts expect the product categories to see greater functionality, apps and use cases, all of which are seen fueling growth in these markets going forward.
The forecast for the global wearables market pegs 124.9 million shipments by the end of 2018, going from 10.3 percent last year to 8.2 percent this year. For AR and VR headsets, IDC noted an even greater stumble in real-world numbers during the first quarter of 2018. In a separate report, analysts tracked worldwide AR/VR shipments totaling 1.2 million units, for a drop of 30.5 percent year over year.
But IDC remains optimistic. Apple set a benchmark last fall by integrating — and popularizing — cellular connectivity on the wrist. Now senior research analyst Jitesh Ubrani believes that this functionality being at a literal arm’s reach will drive popularity.
“The shift in consumer preferences towards smartwatches has been in full swing these past few quarters and we expect that to continue in the coming years,” said Ubrani. “While Apple will undoubtedly lead in this category, what bears watching is how Google and its partners move forward.”
IDC projects smartwatch growth next year through 2022.
As for reality-bending eyewear, the firm traces the recent downturn to the “unbundling” of VR headsets. Once commonly free with certain smartphone purchases, this model wound down as the new year kicked in. Now, the firm believes new consumer and business use cases will drive growth.
While entertainment, education and gaming has rallied around VR, and tech companies such as Facebook aim to make it more social, virtual environments are still a test lab for consumer goods businesses. AR has seen much more interest from brands and stores, from digital make-up try-ons to furniture placement in real rooms.
“Momentum around augmented reality continues to grow as more companies enter the space and begin the work necessary to create the software and services that will drive AR hardware,” said Tom Mainelli, program vice president, devices and augmented and virtual reality at IDC. “Industry watchers are eager to see new headsets ship from the likes of Magic Leap, Microsoft, and others.
“But for those devices to fulfill their promise we need developers creating the next-generation of applications that will drive new experiences on both the consumer and commercial sides of the market.”