The Smartwatch Group has released a report into who it thinks the runners and riders for the next boom in the IT industry.
In a new report the analysts say that 3 million smartwatches were sold in 2013 compared to 0.3 million in 2012, meaning the global smartwatch industry has multiplied tenfold in the last year.
Already the market is narrowing on 10 leading smartwatch companies who between them have a market share of 82 per cent. The report predicts that there will be an exploding number of hardware vendors and the definition of app standards will result in a continued high growth in 2014.
Clock ticking on boom
If this happens then software will outpace hardware as the way that customers can tell the difference between products and vendors can differentiate their products.
Software standards have evolved, and 30,000 developers are currently building smartwatch apps and use cases beyond activity monitoring and notifications, the report says.
The makers seem to see activity tracking, sports performance measurement, smartwatch and conventional watch markets growing together.
Samsung is currently the market leader with its Galaxy Gear having 33.8 per cent of the market. This is a long way ahead of Nike and Garmin with 8.4 per cent. Fitbit has 8.2 per cent while Sony has 7.0 per cent.
Looking at the R&D work being carried out in other companies Smartwatch expects the number of companies with smartwatch offerings to grow from 40 to 200 until the end of 2014. The market volume of the smartwatch industry will increase 2.5 billion in 2014, while the average price per smartwatch will decrease from $225 to $205.
It adds that when Google and Apple get their products out, it will probably add considerable value to the industry. One of the more important aspects is the development of software that these two will provide.
"App developers and hardware providers form a virtuous circle: the more relevant smartwatch apps there are, the higher hardware sales, the better and more affordable hardware, which again attracts more app developers. With 30,000 software developers working on smartwatch apps, the critical mass has been reached now," the report points out.
- Now read how Huawei is hoping to enter the market