The global smart phone market saw a spurt in demand in the past 5-6 years. Now the global market size is pegged at around 270 billion USD. It used to be hardly 50-60 billion USD back in the year 2009. Clearly, disruptive technology is the norm of the hour and people who do not evolve with time tend to perish.
The new global market for smart phones created a host of opportunities in the field of mobile applications ushering in the start-up culture. The smart phone app market alone is expected to be worth 77 billion USD. And why wouldn’t it be? There is expected to be nearly 1 billion smart phones in the world in 2015. That is twice the number of personal computers. Now, this is the kind of growth that we have seen in the new technology sector in the past 4-5 years.
In recent times, the stress for innovation has been on wearable technology. It was mostly limited to prototype models after the lacklustre market performance by the Google glass. But Apple decided to take the game head on and lived up to its tag of being the game-changer in the technology industry. The smart phone industry was pioneered by Apple with the launch of the iPhone way back in 2007 and they did it again in wearable technology with the launch of their much hyped smart watch. Sales of the watch have been satisfactory with IDC predicting the tech giant will be selling 13.9 million watches in 2015 giving it a 58.3% market share.
Given the relatively timid reception of the other smart watches in the market, it can be relatively fair to assume that the Apple Watch will dominate the market in the near future. A report by IDC predicts that Apple will sell 40.3 million watches in 2019 with a market share of 47.4%. The drop in market share will mostly be attributed to the cheaper Android models which have started to flood the market.
Given the imminent growth of the Apple smart watch, apps for the watchOS are set to flood the iStore sooner rather than later. You will be wise to jump on the opportunity and take an early-movers advantage.
Let us list out the various advantages for you to invest in WatchOS apps.
1.It is a virgin territory: The smart phone app market has 1 million apps on the Android platform and 1.2 million apps on the iOS platform. Clearly, getting noticed in the intensely crowded market will be quite a task. Instead, the WatchOS market is unchartered territory with the device itself having been launched a few months back. So getting noticed in this market will be relatively much easier.
2. Lesser capital costs: The biggest advantage of the app industry compared to the regular businesses is the absence of capital cost. The investment is majorly into human capital who create the app from their preferred location. So you do not need to invest millions of dollars buying posh office spaces and maintaining them. Besides, with the relatively lower capital costs involved, you can invest more money in quality human capital. So you can actually get the best people on the job without even having to pay for the office space.
3. Scope for innovation: With the relatively subdued launch of the Watch OS2 the developer community hasn’t really started developing apps for the smart watch. This is mainly because the lack of complications in the watch and the seemingly tiny screen space available. Most people see the watch as a lifestyle device offering notifications and real time information. To many buyers, it is an expensive extension of their iPhone. While this may sound disheartening to some, it actually poses a great opportunity for the designing community.
This is one area where they can innovate and create something new and exciting at last. They need to research on the possible complications that can arise from daily use of the watch and also probably works to increase the utility of the device. Once the apps are created which actually lend the watch some utility then the sales of the watch can also be expected to pick up. Besides, the small screen size will force the developers to look at new notification techniques along with other UI/UX features.
4. There still are no clear competitors: A major reason why android toppled Apple from the helm of the smart phone business is the pace at which it developed its app store. The apps it has on offer rival those of iOS at every step and sometimes beat iOS at it. In case of the smart watch however, Google hasn’t been able to pull off an impressive trick from its Android hat. The Android based watches are facing significant problems surviving in this Apple dominated market. Hence, the number of Android watch apps is abysmally low. So there is almost no competition for the WatchOS apps.
Having said that, these are just pure business advantages.
All investments have to be made after much deliberation. While the watchOS platform does seem to be an potentially huge market for apps it might take a decade for the watch to become a standalone device if at all that happens. Hence, the investor needs to be prudent in the kind of app he chooses to fund. It is a market for the risk-takers and not much speculative. Within a few years the invisible hand of supply and demand could convert this barren market to a new bubble.
