Google's $1,500 Wearable Tech Test Makes Sense

Google makes Google Glass available for sale.

May 14, 2014 at 10:15AM

U.S. stocks are slightly off yesterday's all-time high on Wednesday morning, with the benchmark S&P 500 and the narrower Dow Jones Industrial Average (DJINDICES:^DJI) down 0.20% and 0.30%, respectively, at 10:15 a.m. EDT. In company-specific news, serial innovator Google (NASDAQ:GOOG) is finally making its intelligent spectacles, Google Glass, broadly available -- although at a retail price of $1,500, it does not yet qualify as a mass-market product. The launch could constitute a major milestone in the nascent wearable devices space -- even if Glass never achieves widespread adoption, the launch is another example of Google's clever approach to product development and marketing.

One month ago tomorrow, Google held a one-day "flash sale" of Google Glass, the eyeglass-shaped digital device that responds to voice commands and places a miniature screen just above the user's right eye (see below -- it's the latest look in cyborg fashion!). Although Google did not release any sales data for that event, it must have been satisfied with the results -- indeed, in a post on Google+ on Tuesday afternoon, the company announced it will sell the device to anyone willing to fork over $1,500.


Source: Wikimedia.

Not coincidentally, the first rubric that appears on the Google Glass Web page to explain what it does is "Be Active," which highlights applications relating to sports and physical fitness. Arguably the first successful wearable devices -- barring the wristwatch -- were heart rate monitors and GPS navigation systems for sporting and outdoor activities. Those remain niche products, however; the key to a mass-market product is offering functionality that everyone wants or needs.

As far as everyday uses for Google Glass, they're the same as the most basic functions of a smartphone, including making calls and sending text messages, taking pictures and recording videos, Web search, news, and so on.

I'm far from convinced that Glass will become a mass-market product. In fact, I'm not sure even sure Google believes that -- at a multiple of the cost of the most expensive cell phones, the price is currently prohibitive in terms of that goal (although we know that prices of new consumer technologies fall quickly over time -- assuming they find enough demand, of course). The reviews I have read suggest Glass isn't a must-have technology at this stage; it will most likely require several product development cycles before it can even vie for that title.

However, the general release of Glass gives Google the jump on rivals including Apple (though not on Samsung, which is already selling a smartwatch) in terms of understanding how people want to use wearable technology. In that regard, this release is just another milestone in Google's sophisticated approach to product testing and innovation. Given the opportunity wearable technology will ultimately represent, it makes all the sense for this Silicon Valley innovator to be pushing forward in this area.

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Alex Dumortier, CFA has no position in any stocks mentioned. The Motley Fool recommends Google (C shares). The Motley Fool owns shares of Google (C shares). Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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