We're About to Find Out if People Really Want Smartwatches

Apple and Google will take different approaches to the smartwatch market, but can either succeed?

Jun 28, 2014 at 10:00AM

The Moto 360 smartwatch will launch later this year. Source: Google.

Google (NASDAQ:GOOG) (NASDAQ:GOOGL) officially launched its Android Wear software earlier this week, powering new smartwatches by Samsung and LG. Not to be outdone, Apple (NASDAQ:AAPL) is rumored to launch its own watch this fall.

There are, of course, already plenty of smartwatches on the market right now. But let's be honest, Android Wear or Apple's smartwatch OS will be the software that truly spurs smartwatch sales, if people want them at all.

Android Wear Gear

Samsung's Gear Live running Android Wear. Source: Samsung.

Google's approach
The company that now dominates the mobile world with one billion active Android users has officially set its sights on the wearable tech market with Android Wear. Sure, Google already has Glass, but that wearable tech isn't going mainstream anytime soon. Android Wear on the other hand, is discrete enough to hide on a user's wrist, yet powerful enough to field smartphone notifications, voice commands and specific app functions.

It's a great start, and worldwide mobile powerhouses Samsung and LG brought their smartwatches to life this week with Google's software.

Samsung has tried, with little success, to spur its own smartwatch sales with Android and its own Tizen OS. But what the market has needed, and what Google now brings, is a wearable-specific OS that knows its job is to be the smartphone's wingman.

Android Wear is a sleek system in its own right, giving users what they need and leaving out the clutter. Google's voice search and commands are second to none and will likely be a key factor in making smartwatches useful to their wearers.

Apple's angle
Apple has yet to release a smartwatch. So, Google clearly has the advantage in the space, at least for the next few months. Apple has always been about creating hardware and software that work together seamlessly, and if it does indeed release a watch we can expect the same approach.

But Google's real advantage over Apple lies in the fact that it can afford for the smartwatch market to fail. If the mass market refuses to buy smartwatches, Google won't skip a beat. It still has Android on mobile, Android TV and Android Auto to keep going with. Since Google sold Motorola to Lenovo, it doesn't have any significant smartwatch hardware to worry about.

But the same isn't true for Apple. The iMaker not only has to reinvent its iOS for a smaller screen, but also has to design amazing hardware to go along with it. There's no way know just yet how much Apple has spent on hardware for a smartwatch, but we can assume its more than Google.

Apple not being the first to the smartwatch game isn't all a bad thing. The company has more to think about than Google does.

Foolish final thoughts
The wearable market is expected to take off over the next few years, but I've had some doubts as to how this will play out in the smartwatch space. People will have to pay more money for an additional device to do a fraction of the functions a smartphone can do -- which they already paid hundreds of dollars for in the first place.

I think there has to be one or two killer features that only smartwatches do (or at least do much better than phones) in order for this market to be what smartphones and tablets are today. Even with Google's slick Android Wear, I don't think we're there yet. That leaves Apple wide open to take the market. Maybe it'll be as simple as pairing an iWatch with home automation or health and fitness in better ways than Google.

But either way, the smartwatch market needs a can't-do-without-feature that will get many millions of people to drop an additional few hundred dollars on more tech -- and right now I'm just not seeing it.

Despite what you've heard, not everyone's a skeptic
There's plenty of smartwatch believers out there, and The Motley Fool thinks there's one company poised to benefit from the wearable tech market in big ways. This small company makes the tech that allows wearables to communicate, and it's already in devices made by some of the world's largest tech companies. To find out more about this stock's potential just click here.

Chris Neiger has no position in any stocks mentioned. The Motley Fool recommends Apple, Google (A shares), and Google (C shares). The Motley Fool owns shares of Apple, Google (A shares), and 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.

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Jun 12, 2015 at 5:01PM

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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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