Thinking of Starting a Business? Why Wearable Computing is Red Hot
Pretty soon, your smartphone will be as quaint as an eight-track player, replaced by a pair of computerized contact lenses that can predict the weather or deliver your Facebook feed. That's wearable computing, which has already crafted a following among sports enthusiasts. You're about to see it everywhere, through 3-D glasses, watches, and other personal devices that will shape your environment, explaining what you are seeing and what you can do with it.
"The inexorable trend of the Web is that it will be released from the page and be displayed on the real world," says Michael Liebhold, a senior researcher specializing in wearable computing at the Institute for the Future in Palo Alto, California.
Your opportunity? Think as big as the smartphone market.
Wearable computing is already big. And it's only getting bigger--fast.
The wearable computing market was worth about $800 million in 2012, according to Juniper Research. That's expected to nearly double by 2014, the research firm says. Juniper estimates that the number of app-enable peripheral devices sold will jump from 18 million in 2013 to about 170 million in the next five years. Growth will be driven by consumer electronics, fitness, and payments, according to Juniper, but devices for health care will also help pave the way. Though North America and Western Europe will be the biggest markets, Asia and India will also be critical.
The technology is a barrier; it has a ways to go.
One of the biggest challenges facing the wearable computing is creating an "ecosystem," in which disparate devices can connect and communicate with each other, says Liebhold. That means having always-on connections managed by networks capable of managing huge spikes and dips in activity.
Plus, there are some financial barriers to entry. Producing a physical product can prove capital intensive and logistically challenging. If you're manufacturing in the U.S., you'll need to find a manufacturing facility and you'll have to pay workers more than their counterparts in lower-wage countries. If you're going to outsource to Asia, you'll have to find a reputable factory there, and expect turn-around times that can take months.
And ultimately, consumers have to be convinced they need this stuff, which means you may have to heavily invest in marketing.
Take note--the giants are watching...
Several large companies are experimenting in this space, including Google, Microsoft, Sony, and Samsung. Lately, Google seems to be attracting the most buzz for its Google Glass, the wonky-looking glasses that lets you take pictures and videos with voice commands. Plenty of start-ups are trying to cash in on Google Glass, and more generally wearable computing, which is not only a hardware opportunity, but also an opportunity for software and app developers. "There is a fair amount of excitement about this, as it's a new platform for app developers to develop and generate revenue," says Scott Strawn, program director for Google Strategic Advisory at research company IDC, based in Framingham, Massachusetts.
Meanwhile, Apple is working on watches and possibly its own version of Glass. Nike already offers Bluetooth connections between certain sneakers and iPhones, iPods, and watches that calculate workout stats.
...But that's not all bad
Big tech companies and VCs may eventually become investors, trolling the start-up world for the Next Big Thing. So far, many wearable computing start-ups have either bootstrapped or raised money through crowdfunding sites. For instance, Google Glass competitor GlassUp has already raised over $100,000 toward its $150,000 of its goal on Indiegogo. The company claims its glasses will be augmented reality devices that deliver texts and emails and as well as give you directions, track your heartbeat, and translate foreign languages. (Plus, they're currently priced at about $200, compared to an estimated $1,500 for Google Glass.) And Start-up Pebble raised $10 million in 30 days on Kickstarter for a watch that downloads data from your phone.
VC investors are starting to take notice. CB Insights estimates companies operating in the Wearables market have raked in about $570 million in backing to date. After its successful Kickstarter campaign, Pebble raised $15 million in series A financing from Charles River Ventures this year. Similarly, Withings, which invented a wearable device that measures body activity, recently raised about $35 million from Bpifrance, Idinvest Partners, 360 Capital Partners, and Ventech, according to VentureBeat.
Best Prior Job
Design engineer or industrial designer. You'll need either to possess or find expertise in technology--both for software and hardware. Hiring a programmer--or a fleet of them won't come cheap. Starting salary for an experienced programmer is around $100,000. And when it comes to products like these, a gorgeous design means everything in terms of sales, as Apple has taught us.
Augmented reality: Computer-generated objects that appear within the real world. In other words, images and maps and words could drape themselves over your field of vision, offering explanations of what you are looking at: Want to know the age of a building? Presto, that information could be retrieved and streamed to your wearable device. Your car broke down? A virtual manual would appear before your eyes diagnosing the problem and offering suggestions for fixing it. Liebhold predicts we'll see wearable devices that produce augmented reality before 2025.