Samsung has taken a clear and dominant lead in the smartwatch market, but it’s still early days and big changes could be on the horizon.
Sales of smartwatches in the U.S. were around 430,000 in the six months from October 2013 to March 2014, according to sales data released by NPD on Wednesday.
Of those, almost four out of every five were first- or second-generation Samsung Galaxy Gear devices and most of the rest were Pebble smartwatches. Sony, which was one of the first companies on the market with a smartwatch, accounted for the largest slice of the remaining 4 percent of sales not snagged by Samsung or Pebble.
“Samsung’s Galaxy Gear fits the exact definition of what we currently think a smartwatch should be,” said Ben Arnold, executive director of industry analysis at NPD.
He attributed the success of the Gear to its features, including smartphone notifications and fitness tracking, Samsung’s offer of the watch as a bundle with the Galaxy S5 smartphone—something that allowed the price to be subsidized, and Samsung’s wide distribution network.
The market is expected to continue growing in 2014, but it might look very different in 12 months from now.
Android Wear on the horizon
Google will soon launch Android Wear, a customized version of its Android operating system for wearable devices. At last week’s Computex IT show in Taipei, many companies showing prototype smartwatches said they are awaiting the new OS and hope it will bring innovation and new features to the market.
Another major driver could be Apple, which is rumored to be working on a wearable of its own. If some of its previous product launches are a guide, an Apple device could bring major change as competitors race to match and mimic its features.
Among prospective buyers, price was cited as the number-one barrier to adoption, according to an NPD consumer survey. The survey found 30 percent of 16- to 24-year-olds and 25 percent of 25- to 34-year-olds are interested in purchasing a smartwatch.
NPD’s estimates are based on data from point-of-sales terminals at retailers.