Apple Watch to continue as market leader in wearables category

The worldwide wearable device market (commonly referred to as wearables) will see continued growth as second- and third-generation iterations reach the market, according to IDC. The Apple Watch will be the market leader, according to the research group.

The worldwide wearable device market will reach a total of 111.1 million units shipped in 2016, up a strong 44.4 percent from the 80 million units expected to ship shipped in 2015, forecasts. By 2019, the final year of the forecast, total shipments will reach 214.6 million units, resulting in a five-year compound annual growth rate (CAGR) of 28 percent, says the research group.

"The most common type of wearables today are fairly basic, like fitness trackers, but over the next few years we expect a proliferation of form factors and device types," says Jitesh Ubrani, senior research analyst for IDC Mobile Device Trackers. "Smarter clothing, eyewear, and even hearables (ear-worn devices) are all in their early stages of mass adoption. Though at present these may not be significantly smarter than their analog counterparts, the next generation of wearables are on track to offer vastly improved experiences and perhaps even augment human abilities.”

One of the most popular types of wearables will be smartwatches, reaching a total of 34.3 million units shipped in 2016, up from the 21.3 million units expected to ship in 2015. By 2019, the final year of the forecast, total shipments will reach 88.3 million units, resulting in a five-year CAGR of 42.8 percent.

"In a short amount of time, smartwatches have evolved from being extensions of the smartphone to wearable computers capable of communications, notifications, applications, and numerous other functionalities," notes Ramon Llamas, research manager for IDC's Wearables team. "The smartwatch we have today will look nothing like the smartwatch we will see in the future. Cellular connectivity, health sensors, not to mention the explosive third-party application market all stand to change the game and will raise both the appeal and value of the market going forward.

Apple's watchOS will lead the smartwatch market throughout IDC’s forecast, with a loyal fanbase of Apple product owners and a rapidly growing application selection, including both native apps and Watch-designed apps. The research says that “very quickly, watchOS has become the measuring stick against which other smartwatches and platforms are compared.”

Android/Android Wear will be a distant second behind watchOS even as its vendor list grows to include technology companies (ASUS, Huawei, LG, Motorola, and Sony) and traditional watchmakers (Fossil and Tag Heuer). The user experience on Android Wear devices has been largely the same from one device to the next, leaving little room for original equipment manufacturers to develop further and users left to select solely on price and smartwatch design, says IDC.

The research group adds that smartwatch pioneer Pebble will cede market share to AndroidWear and watchOS but will not disappear altogether. Its simple user interface and devices make for an easy-to-understand use case, and its price point relative to other platforms makes Pebble one of the most affordable smartwatches on the market.