Smartwatches struggle in health and fitness wearables

Basic bands exceed 9 million shipments, while smartwatch sales slump
Fitbit has dominated the basic band sector in the second quarter of 2016, with 3.7 million shipments according to Canalys.
The research firm’s study of the wearable technology market shows that total shipments of basic bands, which are mainly health and fitness trackers, exceeded 9 million units. Xiaomi followed in second place, shipping nearly 3 million Mi bands, while Garmin finished off the top three with over 700,000 units.
Fitbit’s basic band shipments managed to grow an impressive 36% year on year. “Fitbit’s remarkable growth story has continued,” said Canalys analyst Jason Low. “It has managed to do this primarily by driving its main competitors out of business. Jawbone’s shipments, for example, will soon come to an end.
Pressure on Fitbit’s business from smartwatch vendors is mounting, though, especially if they can achieve lower price points and improve battery life to take a bite out of the basic band market.”
While basic bands continued their strong growth streak, the second quarter saw a lull in the market for smartwatches. Apple shipped only 3 million watches during the first two quarters of 2016, but its shipments are poised to triple in the remainder of the year thanks to a new Apple Watch. Canalys also forecasts that 7.5 million smartwatches with cellular connectivity will ship in 2016.
Android Wear shipments are declining in 2016, as momentum behind new product launches has waned. “Android Wear 2.0 is a major improvement for the platform, but for it to make maximum impact Google must become more directly involved with driving compelling Android Wear products,” said analyst Daniel Matte. “Apple has also predictably struggled with the extended product cycle for its first Apple Watch.
watchOS 3 meanwhile fixes the platform’s performance deficiencies by trading off battery life out of necessity. The platform should now be on course to improve its app ecosystem and increase sales.”
Canalys defines basic wearable bands as devices serving a specific set of purposes that act as accessories to smart devices, are designed to be worn on the body and not carried, and cannot run third party computing applications.
Smartwatches are defined as multi-purpose devices that serve as accessories to smart devices, are designed to be worn on the body and not carried, run an operating system and are capable of running third party computing applications. Bands are wearables designed to be wrapped around the body, including watches, and do not include activity trackers in the form of clips.

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