1

Wearables

2

Established watchmakers and accessories

developers to target promising wearable

start-ups for M&As. This is primarily to

integrate features of smart

watches/fitness bands into traditional

watches

Market Experiencing Exponential Growth While Disrupting Traditional

Industries

Cumulative Market Size (2016-2020) o Apple Inc, USA

o Samsung Electronics, South Korea

o Xiaomi, China

o Circet, France

o Magic Leap, USA

o Thalmic Labs, USA

The market for wearables technology has witnessed

rapid growth in recent years. There is a healthy mix of

start-ups, and established companies that are aiming to

get a fair share of a multi-billion dollar opportunity.

o Apart from being self-disrupting,*

wearables are going to disrupt

others such as traditional

watchmaking and accessories

markets.

*For instance, smart watches to eat

into fitness trackers

o Prominence of online sales channels

will spur growth of wearables

o Insurance companies to use wearable

data to determine premiums and offer

benefits

o Multi-functional wearables

to become a key success

factor for consumer

applications

o Accuracy and non-

invasiveness are intended

for healthcare applications

o Long battery life and

robustness are critical for

industrial use

Fossil Acquires Misfit

Wearables can

disrupt

Factors Critical for

your Target Industry

Companies to Bet on

Business Models to think of

M&As will be prominent for

growth and survival

3

Steep Rise in Intellectual Property Filing Confirms R&D Focus

VC funding to remain a key

contributor to the emergence of a

fresh host of start-ups

Wearables is a hot area for

government funding. Various EU

projects are underway targeting

diverse applications

Crowdfunding is emerging as a key

source of funding for small startups

that are introducing innovative

wearable products.

Crowdfunding enables startups to

gather initial product feedback and

market interest, and ideally follow

with VC funding.

1997

o Number of patents filed by top patent assignee Samsung Electronics,

o This is closely followed by Apple Inc. (1666) and Nokia (1325).

o Google, Qualcomm, and Intel are also actively pursuing IP in this area.

USA

19762

9097 Top Assignees From the Region:

o Apple Inc

o Google Inc

o Qualcomm Inc

EU

127

577

Top Assignees :

Nokia Corp (Microsoft acquired Nokia’s

devices and services division in 2014)

APA

C Top Assignees :

Samsung Electronics

LG Electronics

Sony Corp. 813

58

Published Granted

211% Growth in the number of patents filed in 2015 as compared to 2013,

marking intense R&D activities in wearables. Patent infringement cases are

also prominent, notably between Jawbone and Fitbit

US $793.5

Million

Series C funding round received by

Magic Leap, USA, in February 2016.

Investors include Alibaba Group,

Google Inc., Qualcomm Inc., Warner

Bros., and others.

Source: Frost & Sullivan/Lens.org

Patents search range: 2012-2015

IP Landscape (2012-2015)

4

Healthcare and Consumer Electronics Sectors to Have a High Impact

o Fitness trackers

o Smart watches

o Smart glasses

o Game/device controllers

o Remote patient

monitoring

o Health monitoring

Healthcare Consumer

Electronics

Sports

o Athletic training

o Health and performance

monitoring

Wearables allow more efficient remote

and continuous monitoring of patients.

Even in healthcare facilities, the use of

wearables will allow patients to have

greater mobility and less discomfort.

Smart watches are expected to be the dominant

platform in consumer electronics. Smart jewelry is

an emerging field where traditional jewelry will

converge with wearable electronics technology

The sports industry is rapidly absorbing

advanced technologies for both training and

monitoring of athletes. Key sports where

wearables are expected to make huge

inroads include golf, swimming, athletics,

cycling, motorsport, and impact sports.

Application-specific Product Development is ensuring final products meet user needs specific to the sector

o Smart watches/glasses for

enhanced driver experience

o Alerts and navigation

o Maintenance assistance

o Military

o Law enforcement

o First responders

Homeland Security Automotive Industrial

o Personnel

safety

o Maintenance

assistance

Wearable technology is expected to play

a pivotal role in future product

development for military, law

enforcement, and first responder

applications. This is primarily due to

health and safety concerns of personnel,

as well as for collecting evidence.

Wearables, especially smart watches, will be a

key accessory promoted by automotive

OEMs. User Interface needs to be highly user-

friendly. Uptake will depend largely on the

reception of initial product launches.

In addition to monitoring

body parameters, wearables

will also be used to monitor

the environment of

personnel. This technology

greatly enhances industrial

safety and is expected to be

adopted extensively in the

medium- to long-term.

Impact Indicator: (2016-2020)

High Medium Low

5

High Disruptive Capability Transforming Industries Globally

Smart is the

New Green

Social Trends:

Gen Y, Middle

Bulge

Connectivity and

Convergence

Bricks and Clicks New Business

Models: Value

for Many

Health, Wellness

and Well Being

Disruptive Index

9/10 TechVision analysis provides a high score to Wearables for its disruptiveness. This signifies that wearable technology is

bringing in ‘Game Changing’ innovation across sectors of economic activity. Wearables are disrupting traditional

watchmaking and jewelry industries as well as monitoring and fitness tracking.

6 Wearables are impacting multiple

megatrends, which is a key factor for the

high rate of adoption of the technology

o North America is leading in

terms of wearable electronics

product shipments and market

revenues.

o Major consumer electronics and

IT companies such as Apple,

Google, Intel, Microsoft, and

Qualcomm have invested heavily

in technology development.

o In Europe, Germany and UK are leading the

wearable electronics market.

o The European wearables market is currently

growing at a lower rate when compared to the

other regions.

o EU funds various collaborative projects

involving academia and industry participants,

exploring next generation technologies and

applications.

o APAC is one of the fastest growing regions in

the adoption of wearable electronics.

o China can be expected to lead the countries in

the Asia Pacific region in the development of

wearable electronics.

o With various consumer electronics OEMs

based out of the Asia Pacific region, such as

Samsung, LG, Sony, Xiaomi; new products

with next generation capabilities can be

expected to be developed in the near term.

Most Lucrative

Market

Considerable

Collaborative

Efforts

Growing Market

and Emergence of

Key Stakeholders

6

Companies to Watch

CICRET, France

Bracelet that includes a Pico

projector and gesture

recognition technology,

allowing users to control a

connected smartphone using a

projected image on the arm.

Magic Leap, USA

Developing a Wearable

Augmented Reality Platform that

will seamlessly mix virtual

content in real-life environment.

The company has been secretive

about its technology but has

attracted multi-billion dollar

funding.

Companies

to Watch

out for

Fitbit, USA

Fitbit is one of the major success

stories for wearables. The

company was founded in 2007,

and in 2015 filed an IPO with

NYSE listing. The company has a

large portfolio of wearable

products targeting fitness

tracking.

Xiaomi, China

Xiaomi has a commanding presence in

the Chinese market and is growing

globally. A major success factor for

Xiaomi’s wearables has been the low

cost, which allows the company to

target first time users.

Thalmic Labs, USA

The company has developed the

Myo armband that monitors

muscle activity to determine hand

gestures. The technology has the

potential to transform the gesture

control market.

Rithmio, USA

Rithmio has developed a gesture

recognition software platform that

includes machine learning. The

technology will allow higher

accuracy in gestures and

movements determination by

wearables. The machine learning

capability facilitates the

understanding of gestures unique

to individuals.

7

Key Questions for Strategy

Key Questions

for Strategy planning

What are the major areas of improvement in the

current generation of wearables? Battery Life– The limited battery life of wearables is a

concern that needs to be addressed to enable

convenience to users. Companies can look to leverage

energy harvesting and wireless charging to address this

issue.

Accuracy of Sensed Data–Sensor data tracking

parameters such as steps taken, workout stats often

provide erroneous results. Efforts should be taken to

reduce error percentage to a minimum.

In what ways wearable as a service

can be leveraged?

o Industrial–For monitoring of personnel

o Sports–Specialized training of athletes

o Office–Training of staff

o BCI headsets for monitoring concentration

o Education

o Determining concentration of students

o Understanding interest areas using brain waves

o Consumer Research

o Focus group studies

o Events

o Using wearables to control drones

o Demonstrations

Should I be concerned about the

disruption potential of wearables?

Traditional watch makers and jewelry manufacturers

face disruption due to wearables in various

proportion.

Smart watches are getting into the product portfolio

of watch makers and jewelry makers are also

exploring integration of electronic technologies. This

is primarily because wearables can be worn as

accessories as well which leads to direct competition

to jewelry.

In-house R&D or technology

acquisition? Both are viable options in the current scenario. A host of

promising start-ups as well as university research are leading

to the development of advanced technologies, which can be

readily acquired by big corporations.

However, in industries that are directly impacted such as

consumer electronics and healthcare, developing proprietary

technologies and strengthening IP allows companies to have

greater flexibility in terms of product or solution

development.