Starting in 2014, the research firm sees growth for the product really taking off as sales to consumers drive the numbers. The growth in sales of glass-type devices is expected to rise 250% in 2014 with 6.6 million shipping by 2016. That would add up to a total of 9.4 million smart glass units sold by the end of 2016. Priced at $1,500, this is no impulse buy and it is a device where sales are driven more by applications for the product than how cool the hardware might look. Without compelling applications for glass-like devices, the whole category could fail. According to Theo Ahadome, senior analyst at IHS, the looks of the hardware matter less than for any other personal communication device recently offered.
Augmented reality software is expected to lead the way, as such software on a glass device would allow users to get information from the screen that isn't available with the naked eye. Building names, reviews, prices, nutritional information are just some of the things that users of a smart glass device will see while wearing them.
Besides the rosy optimistic scenario that plays out with over 6 million units shipped in 2016 alone, IHS also put together one in which only 1 million units of smart glass devices sell in 2016. In this scenario, applications available for use on the product are the same as seen in promotional video that Google has already released for Google Glass. In this case, the product becomes an expensive camera for video capture. The wearable camera market rang up $200 million in sales last year, but would fall far short of what Google ultimately has in mind for Google Glass. So if the device is going to be more than just a wearable camera, Google needs some "must-have" applications associated with the product.
source: IHS via BGR
Shipments of smart glasses may rise to as high 6.6 million units in 2016, up from just 50,000 in 2012, for a total of 9.4 million units for the five-year period, according to an upside forecast from IMS Research, now part of IHS Inc. (NYSE: IHS). Growth this year will climb 150 percent to 124,000 shipments, mostly driven by sales to developers, as presented in the high-end outlook in the attached figure. Expansion will really begin to accelerate in 2014 with the initial public availability of Google Glass, as shipment growth powers up to 250 percent, based on the optimistic forecast.
Smart glass products like Google Glass are wearable computers with a head-mounted display.
Google Glass this month began shipping to application developers who registered as early backers and paid the $1,500 price tag. This is expected to spur innovations in applications that should take Glass from early adopters to the mass market. As the developers get to work and Google encourages venture capitalists to back them, shipments will begin to surge to high volumes, according to the upside forecast.
However, the success of Google Glass will depend primarily on the applications developed for it. If developers fail to produce compelling software and uses for the devices, shipments could be significantly lower during the next several years.
“The applications are far more critical than the hardware when it comes to the success of Google Glass,” said Theo Ahadome, senior analyst at IHS. “In fact, the hardware is much less relevant to the growth of Google Glass than for any other personal communications device in recent history. This is because the utility of Google Glass is not readily apparent, so everything will depend on the appeal of the apps. This is why the smart glass market makes sense for a software-oriented organization like Google, despite the company’s limited previous success in developing hardware. Google is betting the house that developers will produce some compelling applications for Glass.”
The glass is half full
According to the optimistic scenario, developers will succeed in producing augmented reality applications for smart glasses that provide the user with information that can be safely and conveniently be integrated into casual use. Such applications typically are known as augmented reality, which involves adding a layer of computer-generated data to real-world people, places and things.
“The true success of Glass will be when it can provide some information to users not apparent when viewing people, places or things,” Ahadome said. “This information may include live updates for travel, location reviews and recommendations, nutritional information and matching personal preferences, and previous encounters to aid decision making. The upside for smart glasses will arise when they become a powerful information platform. In many ways, this is exactly what Google already does via other mediums, and also is why the upside scenario seems more likely.”
Under a more pessimistic scenario, IHS forecasts that only about 1 million smart glasses will be shipped through 2016.
According to this outlook, applications for smart glasses will be limited to some of those already displayed by Google in its Glass marketing. These include scenarios where smart glasses become more of a wearable camera device than a true augmented reality system. In this case, smart glasses will be mainly used for recording sports and other non-casual events, like jumping out of a plane, as demonstrated at the Google I/O developer conference in 2012.
However, Glass will face competition from alternative wearable camera devices already in the market, such as GoPro Hero or Recon MOD Live.
While the wearable camera market was worth more than $200 million in 2012, it is not the multibillion-dollar market that smart glasses can achieve with wider applicability.
“The less frequently consumers interact with any personal communications device, the less valuable it becomes,” Ahadome observed. “If smart glasses become devices that are used only occasionally, rather than all the time, they become less attractive and desirable to consumers.”