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Industry Trends

2020.01.30
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Market trends and outlook of wearable technology in Korea

1. Introduction
With the remarkable growth of the Internet of Things (IoT), connecting more and covering wider “things,” wearable devices which enable data exchange between a network and a user, are thought to be a key growth driver that can lead the future tech trends.
Wearable devices are also known as wearable computers as they are one of the most adopted IoT system, allowing objects to exchange real time data through the wireless network with another connected devices. What’s now called wearable computing technology was first conceptualized by a research team at the Massachusetts Institute of Technology (MIT) in the 1950s.
The origins of pre-modern wearable devices actually date back to the 1960s, when the prototype was created in the form of the calculator watch or cameras strapped on shoes. Decades later, they have evolved into technologies applicable mainly in the fields of military or R&D.

Since then, wearable technology has become pervasive due to the incorporation of it in daily life. The widespread adoption and availability come from ubiquitous computing capabilities which encompass the development of smart devices, smart environments of an embedded wireless system, along with longer battery capacity. The most widespread wearable devices so far have been smart watches or devices worn on the body like accessories, but the wide variety of VR/AR or bio-health applications for the technology such as patches or implantable types are highly likely to drive the market, diversifying the product portfolio.

2. Types and features of wearable technology
Wearables are segmented into four different product categories. Depending on its design and purpose, each represents a specialized computing function, i.e., portable personal technology is easily carried like mobile devices or accessories. Smart clothes are digital devices incorporated into fabric, and some types are strapped or typically worn on particular parts of the body. Dermally-implanted sensors (literally embedded under the skin) or smart pills administered like medication are classified as transplantable products.


<Types of wearables>

Accessory Digital clothing Patch Implantable

-Smart jewelry or digital garments worn on the body
-Smart eyewear, smart watches

- Smart outfits,
- Wearable computers incorporated into clothes (smart textile)

- Body-attachable patches
- Electronic skin patch sensors and actuators

- Embeddable implants
- Implantable sensors or devices


Wearable devices must be comfortable and have a snug fit just like one’s own clothing (comfortability). For instant interaction and agile feedback, a networking platform that connects the users and devices must always be open (invariability). Any physical/emotional inconveniences or bio-insecurity caused by electromagnetic waves must be blocked (safety). Without invoking any sense of cultural aversion, the technology should well consider socio-cultural context (sociality).



3. Market trends
A global ICT advisory company Gartner, Inc., predicted that consumers across the world are likely to spend as much as USD 52 billion on wearable technologies this year, a 27 percent jump from USD 41 billion in 2019. Much of the spending, in particular, appears to go to smart watches (34 %) and smart clothes (52 %) in the year 2020.
Plus, the ever-advancing nanotechnology is forecast to enable wearable electronics (almost one out of ten) to be small enough to remain invisible by 2023.
IDTechEX, a research group, said that the market size of wearable devices would reach about USD 150 billion in 2026 from 30 billion in 2015, showing an annual average growth rate of 15.8 percent.

Currently, Apple ranks at the top (46%), followed by Samsung Electronics (13%) in terms of the global market share for smart watches, the most popular type of wearable gadgets. Google’s latest acquisition of Fitbit for USD 2.1 billion is further expected to heat up market competition in the coming years.


<Global shipments of wearables and market size by type>

(Unit: 10,000 pcs, %)

Product 2018 2022
Shipments Market share Shipments Market share
Smartwatch 7,280 58.2% 12,020 53.3%
Wristband 4,650 37.1% 4,700 24.7%
Smart clothes 280 2.2% 910 4.8%
Ear-wear 210 1.7% 1,280 6.8%
Wearable robotic devices 70 0.6% 60 0.3%
Others 20 0.2% 20 0.1%
Total 12,530 100.0% 18,990 100.0%

※ Source : IDC

S. Korea’s technological expertise level (an indicator of how competitive a country’s technology is) for producing wearables was assessed to be 84.5 percent. The global digital divide index which demonstrates the technology gap between nations shows the EU at 9.0%, Japan at 12.2%, S. Korea at 15.5% and China at 15.9% (U.S. = 0%), which implies that Seoul is almost 1.2 years behind the U.S.


<Technological expertise level for wearables by country>

Category Wearable Devices
Technological expertise level (100%) Digital divide(0years)
S.Korea 84.5 1.2
U.S. 100.0 0.0
Japan 87.8 0.9
China 84.1 1.3
EU 91.0 0.7

※ Source : ICT The Digital Divide Report (IITP, 2019. 7)



4. Conclusion
The past few years have witnessed rapid development and the introduction of new technologies such as IoT, artificial intelligence and big data analytics. This new trend has many people believing that wearables will replace other mobile devices and become the next key hardware. Kickstarted by global ICT pioneers like Google and Apple, wearable technology is now commonly found in almost every business landscape—fashion, wellness, healthcare, entertainment, public safety and etc.

While ensuring that the market for smartwatch, the first big wave of wearable technology to catch on with consumers, remains sustainable, S. Korea needs to establish a longer term masterplan which requires bigger infrastructure and investment in technology, particularly in the fields of patch-type sensors or implantable devices. In addition, the government should provide policy support to help startups and SMEs preparing to expand to overseas markets to boost their competitiveness in the global business landscape.



[Reference]
[1] Technology trends and market forecasts for wearable smart devices (KEIT PD Issue Report 16-03) (KEIT PD Issue Report 16-03)
[2] Consumers expected to spend USD 52 billion on wearables in 2020(Financial News, 2019.10.31)
[3] An overview of technology trends & market outlook of wearables (COMPA, 2018. 11)
[4] ICT The digital divide report (IITP, 2019. 7)

By Park Won-geun (nayafly@kiot.or.kr)
Executive Officer, Korea Intelligent IoT Association


< *The opinions expressed in this article are the author’s own and do not reflect the views of KOTRA. >


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