OYSTER BAY, NY -- Activity trackers dominated sales of wearable devices in the first quarter, outselling much-hyped smartwatches four to one, new research says. Some 2.35 million activity tracking devices shipped during the period, says ABI Research.

Fitbit remains the market leader, with a majority share, but will face more competition in the current quarter and over the course of the year, especially with Samsung about to launch the hybrid Samsung Gear Fit.

“Activity Trackers are currently the most viable consumer electronics wearable device category, because they have a clear use case that cannot be matched by smartphones, in contrast to smartwatches,” says ABI senior practice director Nick Spencer. “End-users have been happy to ditch their watches and use smartphones to tell the time, so extending smartphone functions to the watch is a weak use case and retrograde step.”

Smartwatch sales dropped significantly sequentially due in small part to the seasonal effect of Christmas, but largely due to the imminent launch of Samsung’s Gear smartwatches and Gear Fit activity tracker. The Samsung Gear dominated sales in the December period (N.B. mainly through bundles with the Samsung Galaxy Note III), but retailers and distributors were looking to clear their Samsung Gear 1 channel inventory in anticipation of the upgrade in the second quarter.

“We shouldn’t dismiss smartwatches, which are an evolving and, if you believe in reincarnation, a nascent category,” adds Spencer. “Smartwatches will develop rapidly in 2014 and 2015, with hybrid activity tracker/smartwatches soon to hit the market, more specialized components being developed and most importantly the use case improving through a growing applications ecosystem. As the value proposition of smartwatches increases, however, the price will still need to decrease to balance with end-user expectations.”

ABI expects 10 million activity trackers to be shipped in 2014 and 7 million smartwatches.

• Prev
• Next