Is wearable technology a consumer or enterprise play?

A look at the current and future state of enterprise wearable technology

wearables right or wrong jon phillips google glass july 3 2014

Wearable technology is a market segment loaded with well-intentioned promise. To date that promise has all been front-loaded onto the consumer space with the proliferation of first generation activity trackers, smartwatches, glasses, and other gadgets. But, there is also an emerging enterprise market for wearable tech. However, it is a market that has, with the exception of healthcare, yet to generate any notable market share. The current perception is that unlike the consumer market, the enterprise lags significantly relative to attaining any sort of sustainable wearable tech momentum. But is this true?

I've spent some time discussing the future of wearable tech with two folks who bring interesting, if different experiences to the wearable tech market. The first is Steve Holmes, the recently appointed VP of Intel’s New Devices Group, who I interviewed recently for a Blue Hill Research podcast. The second is Tony Rizzo, who has been heavily involved with the wearable tech vendor community since November 2012 and who developed and produced two major wearable tech conferences since then. Rizzo is now Entrepreneur in Residence at Blue Hill Research, and we often discuss wearable tech.

Prior to his current role with Intel, Steve was a key design engineer for Nike’s Fuel Band products. This combination of roles leaves Holmes in a unique spot to comment on how the future of wearable tech is shaping up. An important issue we discussed is the possibility of confusing genuine market demand with industry-manufactured buzz - of which there is a great deal.

On the enterprise side of things, the value proposition for wearable tech is still unclear to many. But Holmes noted that he firmly believes they present the opportunity to ‘fundamentally shape how we interact with work.” He hints, and I am inclined to agree, we will need to see a set of advancements before the road to significant enterprise investment is paved.

During the discussion Holmes brought up an interesting point about the current state of wearable tech, likening it to the first generation of mobile phones. I found this particularly compelling as it in line with how Rizzo is seeing the state of technology as well. When I asked him about this his response was that today’s wearable tech is like yesterday’s feature phones – think of the Motorola RAZR. In Rizzo’s own words to me, the RAZR “brimmed with overt futuristic 'style' but was nothing more than a rudimentary mobile feature phone.” He also notes that even though the RAZR was enormously popular it did nothing in 2006 - 2007 to change the dynamics of the mobile market at the time. It was a nice device, but it wasn't in any way revolutionary or for that matter even evolutionary aside from some design cues.

The mobile market only took off ("exploded" might be a better description) once it had a unique defining moment - the introduction of Apple's iPhone. The combination of iPhone capabilities and mobile apps was a game changer. However, with wearable tech no such thing yet exists. Smartwatches are merely 'wrist phones' - they, along with activity trackers and even Google Glass, are likely the RAZRs of our current times.

Holmes suggests that enterprises have yet to find a sustainable wearable tech value proposition, and neither Rizzo nor I disagree with this. But I suspect that finding this value proposition will happen sooner than later. This is important as Rizzo, who is currently researching enterprise wearable tech for Blue Hill, makes the argument that it will be enterprise demand (or lack there of) that will make or break a sustainable revenue stream for vendors.

There is of course wearable tech in familiar forms, such as ID badges, which have shown value to enterprises (as Holmes correctly points out). But few would argue that they present a transformative enough experience to launch a new wave of technological innovation. This wave will come about when wearable innovation embraces other emerging enterprise trends. Especially in manufacturing and healthcare there is a push to utilize mobility, next generation wearable tech and the large-scale connectivity of the ‘Internet of Things’ to drive new capabilities. It is through this that I suspect the eventual catalyst will arise. For example, Holmes and I discussed the advent of Intel’s headset Jarvis, a technology with functionality easily extendible to the enterprise. It’s not hard to imagine Jarvis - or other virtual assistant type technologies such as Siri, Google Now, or Cortana accessed through a personal wearable device - becoming commonplace in the workplace. Implications for efficiency gains around scheduling or planning for instance are magnified when paired with these new levels of accessibility and connectivity. The sticking point will come about when hardware meets the connective and mobile demands necessary to build out enterprise specific applications.

What’s missing currently is the "revolutionary" catalyst to bring it all together in the same way the iPhone did for mobility. And with as much fun as it is to speculate, I don’t know exactly what this catalyst will be. But I believe that enterprise verticals will be where wearable tech eventually earns its real stripes.

 

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