No One Is Buying Smartwatches Any More

Remember how smartwatches were supposed to be the next big thing? About that...

Image: AP

The market intelligence firm IDC reported on Monday that smartwatch shipments are down 51.6 per cent year-over-year for the third quarter of 2016. This is bad news for all smartwatch vendors (except maybe Garmin), but it's especially bad for Apple, which saw shipments drop 71.6 per cent, according to the IDC report

Apple is still the overall smartwatch market leader, with an estimated 41.3 per cent of the market, but IDC estimates it shipped only 1.1 million Apple Watches in Q3 2016, compared with 3.9 million in 2015. To a degree, that's to be expected, since the new Apple Watch Series 2 came out at the tail-end of the quarter. But the news is still a blow, when you consider how huge the Apple Watch hype was just 18 months ago.

Looking at IDC's data, the only company that really did well over the last year is Garmin. Its sales increased 324 per cent, catapulting it to second-place among vendors. Garmin's watches focus on health and fitness, two areas smartwatch owners actually seem to care about. Tellingly, Apple has re-focused its marketing and positioning of the Apple Watch away from fashion and more towards health and fitness with its new models.

So why are smartwatch sales declining across the board? IDC thinks part of the reason is the lack of new hardware. Apple and Pebble's new watches didn't hit the market until late-Q3, and Google has delayed Android Wear 2.0 until next year, leaving many customers waiting for new gear.

But the bigger problem is that it's difficult to justify buying a smartwatch. Jitesh Ubrani, a senior research analyst for IDC Mobile Device Trackers put it bluntly in the press release:

It has also become evident that at present smartwatches are not for everyone. Having a clear purpose and use case is paramount, hence many vendors are focusing on fitness due to its simplicity. However, moving forward, differentiating the experience of a smartwatch from the smartphone will be key and we're starting to see early signs of this as cellular integration is rising and as the commercial audience begins to pilot these devices.

And that's really the problem. For all the promises of a smartwatch, actually living with one is often an underwhelming experience. That can get better with hardware and software improvements — and with a more concentrated focus on areas like health and fitness — but at the end of the day it's still hard for most people to justify the cost of yet another gadget.


Comments

    My moto 360 just sits on a drawer now, after 12 months of sitting next to my bed as a clock.

    Garmin's result shows the power of advertising. I doubt anyone would have known they made smart watches if they hadn't advertised them on TV (I certainly didn't).

      Ironically, I haven't seen any advertising for Garmin smart-watches, But I discovered them while I was investigating new heart rate monitors. Still didn't buy any tho.

    Health and Fitness, bah!

    If they produced a watch that was primarily concerned with Booze and Food, I'd be on it in a second!

    For me, fitness trackers are more useful than smartwatches.

    My fitbit cost 1/3 the price of a smartwatch and has 5-6 day battery life, perfect for me.

    Smartwatches are more in the "gadgety" category so it's not surprising they sold well initially and are now dropping off.

    I've been wearing my pebbles consistently for the last couple of years, and they've greatly impacted the wrist time my other watches get.

    I tend to leave my phone on my desk at work, and never miss an email or call. I can do the same at home and remotely control my music.

    I wear it surfing, and it's my music and gps readout when mountain biking. I can use it when wearing full gloves, covered in mud.

    For me there's enough substance to what it can do, it doesn't inconvenience me wirh constant charging, and it was cheap enough to regard it as a tool instead of some precious object. And it doesn't feel like it's going to be obsolete any time soon because it was never bleeding edge hardware.

    Last edited 25/10/16 12:33 pm

      That's key for me. It's not a direct replacement for what a phone does today but it's more convenient in certain situations and for certain tasks.

      Fitness activities (like your MTB example) are great candidates. So is 'real time' communication like you mentioned (although for me I don't consider email real time) especially with the AI we are getting now for quick replies. I think the remote control example is a great one too, these devices can have physical control buttons (start/stop, etc.), are frequently on your person and don't need to be unlocked.

      Like you I often don't have my phone with me now, especially at home or in the office, and that also means I'm less tempted to spend time using it which has a heap of benefits for my health & interactions with other people.

    I still use my old LG G Watch and want to buy a new watch but I'm too cheap. So this is good news for me. Hopefully it'll drop the price of smart watches.

    I'd like a smart watch but all of the ones I've looked at are either over-priced, too big, or ugly.

    I would think that being made to charge every night would be a good thing? To get into a habit of putting your phone on charge and your watch at the same time then hopping into bed? Seems like such a non issue to me. They're married devices. Well, the Apple watch and iPhone is at least. Doesn't really seem like that much of an inconvenience.....I guess I'll find out after I've bought one in a few weeks time.

      Yea I currently wrap my real watches around their packaging pillow and then in their box anyway. However I'd like something like a smart watch to last two days, so if you have a particularly busy day and long night it's still functioning by the time you head home. A dead phone is infuriating enough, let alone a dead watch with proprietary charger.

    Had the Samsung gear when it first came out, novelty wore off after 2 weeks. No idea where it is now not that I need it or anything lol.

    I'd probably like one but
    - the technology (especially batteries and screens) isn't there yet
    - the cost is too high for what you get

    I have worn my Pebble Steel everyday since I got it - and i just bought two Apple Watches Series 2 for Christmas.

    Interesting this report is from LAST 1/4 and doesn't take into account this 1/4s Christmas period.

    If I could afford a new smartwatch right now I would definitely buy one of the new Pebbles

    The smartwatch fad actually got me back into wearing a watch. I don't own a smartwatch however, I have enough expensive gadgets that need to be replaced every 2-4 years.

    Can't help but think they've reached (or are close to) market saturation. Most of the people who think a smart watch is a good idea have already bought one. And they haven't had them long enough for them to need replacing yet. It's also not like new ones are massive leaps in performance/battery life either so upgrading doesn't gain that much.

    Give it another year or two and the same people who already have them will probably be looking to bu again because there are either better devices or their existing one is starting to hit the wall and need replacement.

    As for the people who aren't early adopters, we'll start buying when they perform and last a hell of a lot longer than they do now. Then you'll start seeing huge spikes in sales.

    I just want the Apple Watch 2 so I can use it for swimming.

    I still use my pebble. Its the best one out their on the fact alone that battery lasts for 1 week.

    I bought my smart watch a couple of months ago and it worked very well for me. I was able to check my emails remotely from anywhere and I even stayed in touch with everyone with it. But the worst part began when its battery got fucked up! In spite of charging it for the maximum time, it was always low on battery. Huh! I think if the smart watch sale percentage is down, it is alright as buying fucked up smart watches is better than to buy no watch at all...

    Ausdroid asked Michael Kors and Fossil about their Android Wear watches and apparently they are selling well. Just like anything new, there was a spike and then they fell back into selling at the average rate of normal watches.

    I'm not buying a smart watch now because I have my Pebble Time Steel, and it does almost everything I want out of a smartwatch.
    Sometime in the future when I'm not poor, I'll be looking into getting a fitness tracker again (The tracking in the Pebble is rubbish) but I won't be buying a smartwatch again until this one dies.

    As a counterpoint, Android Wear was love at first sight, and I would never be without a smartwatch. For me, one key benefit is SMS reading and sending on the watch with voice dictation. Taking my phone out of my pocket to read a one line text message feels utterly last century now. Another is using the watch as a viewfinder for phone camera when inspecting cabling behind the back of equipment. The list goes on....

    I own a Moto 360 and an LG G Watch R and would not be without them. I am often complemented on my watch.

    Where you are right is that for me to upgrade would require a step change in functionality, as right now, Android Wear does everything I need pretty well.

    I was looking at an Apple Watch today. I just couldn't figure out why I would need one? Every electronic device in the world can tell the time. And since you still need to carry an iPhone around anyway - and it does everything - why the need for an iWatch? Only reason I can think of is to use it as a fitness device. But might as well get a dedicated fitness device like a Fitbit for that. Sure, you can poke around on the little screen and look at a map or a message, but since the iPhone is in your pocket anyway, why not take 2 seconds to pull it out and have access to an actual social media smart device?

    Maybe there's not as many narcissists in the world as the makers thought.

    You need to differentiate between "smart watches" eg apple and the android and pebble watches, "sports watches" like Garmin and SUUNTO which are for sports enthusiasts, do what fitness bands do but better, and much more, and "fitness bands". Some smart watches do some of what a fitness watch does, all of them can do what a fitness band does, and some fitness bands do some of what a smart watch and sport watch does. Generally smart watches have a frustratingly short battery life, fitness bands and sports watches have up to 3 weeks battery life. Sports watches and fitness bands may allow notifications from your phone, but dont have apps or a colour touch screen, they mostly use buttons, which prolongs battery life. I have a SUUNTO Traverse, made in Finland not China, wateproof to 100m, drop proof military grade, large black on off-white display, has all the usual watch functions of alarms, sports timers etc, has a barometer, altimeter, GPS, storm warning system, GPS tracking, way point creation and navigation as well as route tracking and saving. With it set to create a waypoint every 5 metres the battery lasts 3 days so it is suitable to track a long weekends bushwalk ( a smartwatch would be luck to track for 8 hours if it has this feature). With no tracking battery lasts about a month. It receives notifications from phone via bluetooth if you want-emails, sms, calendar reminders and google plus notifications. But I dont want so thats turned off.

    Everyone has smart watches at work so I thought I would wait for the successor to the reasonably priced and value for money (but 21 month old) Sony Smart Watch 3. But that hasn't materialised and I've come to like not wearing a watch since my traditional watch's battery went flat a year ago. I'm in Queensland and they're not the most comfortable thing.

    There are clocks almost everywhere I go, including the car, my desktop, tablet and phone's clocks, on walls, etc. etc. Something big has to justify a smart watch. I know there are many organiser-type features but the experience had better be good.

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