Intel (NASDAQ:INTC) recently partnered with eyewear giant Luxottica's (OTC:LUXTY) Oakley brand to launch Radar Pace, a pair of smartglasses designed for athletes. The Radar Pace features personalized training programs, tracks heart rate and performance, and guides athletes with a real-time voice activated coaching system.

The Radar Pace. Image source: Oakley.

The "coach" is powered by Intel's Real Speech voice recognition system, and athletes can use the integrated Bluetooth headset to make calls, dictate texts, or listen to music. But will these new smartglasses succeed where Alphabet's Google Glass failed? Or will it remain another niche product in the market of pricey wearables?

Why Intel is making smartglasses

Intel's partnership with Luxottica isn't its first major move into the wearables market. It previously developed a $1,000 luxury bracelet called MICA with high-end retailer Opening Ceremony, partnered with Fossil to develop fitness trackers and smartwatches, developed biometric earbuds which measure a user's heart rate with SMS Audio, and acquired wearables maker Basis Science to launch the Basis Peak smartwatch.

Intel made all those moves for two main reasons. First, it had to diversify away from the slowing PC and data center markets by expanding into adjacent markets like wearables, connected cars, smart appliances, and other Internet of Things (IoT) gadgets. Second, it needed to widen its moat against ARM licensees like Qualcomm (NASDAQ:QCOM), which dominated the smartphone and tablet markets and threatens to do the same in the IoT market.

Unfortunately for Intel, the numbers suggest that ARM chips are already winning that battle. Earlier this year, Qualcomm declared that it already controlled "more than 80%" of the Android Wear market. Apple Watch, the world's most popular smartwatch, also runs on a custom ARM chip, while Google Glass was powered by an ARM chipset from Texas Instruments.

Google Glass. Image source: Google.

In response, Intel has launched a wide variety of low-power chipsets and modules, like the SD card-sized Edison and button-sized Curie, for IoT and wearable devices. It even launched a TV show, America's Greatest Makers, to promote those chips. Yet Intel's IoT revenue rose just 2% annually, and accounted for just 4% of its sales last quarter -- indicating that they won't offset its weaker PC chip sales anytime soon.

What this deal means for Luxottica

The Radar Pace is much less meaningful for Luxottica, which controls roughly 80% of the eyewear market with its first-party brands Ray-Ban, Oakley, and Persol; its licensed eyewear for top brands like Chanel, DKNY, and Ralph Lauren; and its brick-and-mortar retailers LensCrafters, Pearle Vision, and Sunglass Hut. Oakley is one of Luxottica's top brands, but a single pair of smartglasses probably won't move the needle very much for its parent company.

Therefore, I believe that Oakley's Radar Pace is more of an experimental play which complements the brand's other "high-tech" glasses. Those glasses include its Airwave ski goggles, which features a heads-up display with GPS, jump tracking, caller ID, and text messaging features, and its Thump MP3 glasses.

Pursuing niche users instead of mainstream ones

Google Glass failed because people didn't like to be secretly recorded, and the design looked awkward. Snap is taking another stab at the market with its new Spectacles, but that device could also flop due to the same challenges.

That's why other companies are now targeting niche markets instead of pursuing mainstream users. Sony's SmartEyeglass and Microsoft's HoloLens, for example, are initially targeting enterprise users to make their jobs easier.

Intel and Oakley's Radar Pace also follows that example by targeting hardcore athletes and outdoor enthusiasts. It's unclear how many "high tech" glasses Oakley has sold, but it's been selling the Thump since 2004 and the Airwave since 2012 -- indicating that the same customers might embrace the Radar Pace.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.