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Wearable AI Devices Market Overview
The wearable AI devices market valued $11,182.8 million in 2018 and is expected to advance at a CAGR of 29.0% during 2019–2024 (forecast period). Major factors propelling the market growth include increasing disposable income, growing consumer preference toward next-generation wearable devices, rising adoption of AI-enabled wearables for healthcare applications, surging technological advancements in the consumer electronics industry, changing lifestyle, and growing demand for augmented reality/virtual reality (AR/VR) headsets across the world.
On the basis of product, the global wearable AI devices market is categorized into wristwear, eyewear, earwear, and other bodywear. Of these, the wristwear category held the largest share in the market in 2018. This can be mainly attributed to the high demand for wristwear with AI functionalities, such as heart rate monitoring, sleep tracking, and personal voice assistance. Moreover, on the basis of type, the wristwear category is bifurcated into smartwatch and fitness band, of which the fitness band category is expected to witness faster growth over the forecast period.
Based on deployment, the wearable AI devices market is classified into cloud and on-premises. Between the two, the cloud category held the larger share in the market in 2018 and is also expected to account for higher CAGR during the forecast period. This can be ascribed to the need for storing data generated in real time and synchronizing data in smart devices.
Geographically, North America held the largest share in the wearable AI devices market in 2018. This can be attributed to the high per capita income of consumers in the region, presence of consumer electronics companies offering advanced products at low prices, and increasing investments in technological innovations to broaden the scope of AI application in wearable devices in the consumer electronics, healthcare, and gaming industries. Additionally, during the forecast period, the market is expected to witness the fastest growth in APAC, owing to the increasing demand for wearable devices in the region, particularly in China and India, and growing application of the AI technology in wearables offered in the region.
Wearable AI Devices Market Dynamics
Increasing demand for VR headsets is a key trend observed in the wearable AI devices market. With increasing smartphone penetration and growing trend of mobile and cloud gaming, the use of VR headsets among consumers is increasing. Furthermore, the video games market is expected to reach $92 billion by 2020 as compared to $76 billion in 2017. As a result, the market players are focusing on the launch of VR headsets to offer best visual experience, with additional focus on sound quality, and improve the overall gaming experience for the users.
For instance, in May 2019, Oculus, a subsidiary of Facebook Inc. and a provider of VR hardware and software solutions, launched Rift S, a VR headset specifically designed for gaming. The headset comprises the company’s new tracking technology, Oculus Insight, which uses five cameras embedded in the headset to track the user's movements and location. Moreover, the cameras are enabled with a new feature, Passthrough +, which allows them to get a glimpse of their real-world surroundings. Hence, in the near future, the wearable AI devices market is expected to witness a high demand for VR headsets among consumers across the world.
Growing adoption of AI-supported wearables for healthcare applications is one of the major factors driving the wearable AI devices market, globally. This can be mainly attributed to the growing consumer focus on a healthy lifestyle and increasing awareness on AI-powered wearable devices and the convenience associated with them. AI-enabled wearables allow the users to track what they eat and how much they should sleep in addition to suggesting the changes in their routine to improve their fitness level.
Players in the wearable AI devices market are actively focusing on product launches, with emphasis on AI-enabled wearables for tracking fitness activities. For instance, in October 2018, Garmin Ltd. launched Instinct, a smartwatch featuring GPS, GLONASS, and GALILEO satellite navigation capabilities and a barometric altimeter. Besides, built-in wrist-based heart rate sensors allow the users to monitor steps taken, distance travelled, and calories burned and track stress levels. Hence, the rising adoption of AI wearables for tracking fitness activities is expected to support the market growth in the coming years.
Wearable AI Devices Market Competitive Landscape
The wearable AI devices market is fragmented in nature, owing to the presence of a large number of established and small players. Companies in the market are primarily focusing on partnerships to increase their customer base and capture a larger market share. For instance, in January 2018, Xiaomi Corporation announced its partnership with Oculus to launch standalone VR headsets, including Oculus GO and Xiaomi Mi VR Standalone. Both the headsets utilize the Snapdragon mobile VR platform for high-processing requirements.
Some of the major players operating in the global wearable AI devices market are Fitbit Inc., Apple Inc., Xiaomi Corporation, Samsung Electronics Co. Ltd., Garmin Ltd., Huawei Investment & Holding Co. Ltd., Google LLC, Fossil Group Inc., Microsoft Corporation, Sony Corporation, and BRAGI GmbH.