Turning the Corner to Manufacturing’s Wide Open Future in Wearable Electronics
By Ryan Brinks | Business Development Media
High-tech challenges and opportunities await. And while manufacturers are a step ahead of the public, they too are wrestling with what exactly that near future will look like.
On the heels of pioneering electronic wearables like the Google Glass eyewear, Fitbit physical activity bands and Pebble smartwatches are legions of ideas hoping to discover the market’s sweet spot.
One company at the center of industry collaboration envisions smart bandages that monitor people’s health, diagnose their issues and even treat their illnesses.
“We’ll see helmets in the military and sports fields change in the near future, helping us understand more about head trauma,” said Janos Veres, printed electronics program lead for PARC, an open innovation provider of custom research and development. “And we’ll start to see intelligence printed directly into some wearables, like the soles of shoes, or directly into shirts to measure things like blood pressure, temperature, heart rate, etc. We are working with the Nano-Bio Manufacturing Consortium (NBMC) to explore new types of sensing modes such as stress and metabolism as well as the manufacturing techniques that will be needed to fabricate them.”
Manufacturing is just turning the corner to an era of unprecedented innovation and opportunity, but the paved street has ended and there is no clear path forward.
“We're just getting started ourselves, as well as everyone else, and we're all feeling around in the dark right now,” said Smart Fabrics & Wearable Technology 2014 Conference speaker and Misfit Wearables founder Sonny Vu. “These things are pretty hard to make, and it's clear from all the recalls that we've been seeing that it's not as easy as simply applying the same traditional models and sources of consumer electronics manufacturing to the world of wearables, where fashion, comfort and safety are of the utmost importance.”
Yet the prospect of a multi-billion-dollar market and the convergence of new technologies that are stripping away barriers to quick commercialization of products are driving both start-ups and superstar brands to the forefront of this uncharted landscape.
“Wearables are a solution in search of a problem,” IBM Vice President and Global Industry Leader of Electronics Paul Brody said in a recent interview. “The challenge is getting people to decide they want the device and that it makes a difference in their quality of life.”
The one thing that is clear to Brody, however, is the wearable electronics industry’s diversion from traditional manufacturing to what he calls an open source future. Born in the likeness of open source software, where foundational structures and basic components are shared openly, open source manufacturing provides a launching pad for new products.
“Typically a great deal of time is spent on designing, engineering and testing before you bring a product to market,” he said. “In the future, you’ll start with a product where 70 to 80 percent of the work is already done.”
The remaining adaptation and customization comes not only much faster but at a much lower cost.
Combine that product development head start with other game-changing new technologies and you have a recipe for “a new era of explosive innovation” that melds open source manufacturing with 3D printing of low-volume batches of products, Facebook and other social media to drive low-budget marketing, and crowd funding opportunities like Kickstarter instead of traditional gateways like venture capital.
“What’s amazing about all these technologies coming together is that in every single case, they’re removing barriers to small businesses and entrepreneurs to build and create and launch their own products,” said Brody, whose point of reference is none other than IBM’s enterprise process framework: idea to market, market to order and order to cash. “Every one is being simplified, every one is being compressed.”
It’s a compelling vision that’s currently all but reality; Brody admits that no open source branded product has made it to market, though Pebble’s trailblazing path through Kickstarter with no marketing budget to speak of and a small volume of product has proved part of the equation, and the rest is “something we’ll see in the very near future.”
Between now and then, the staunchest of challenges remain the use case, as Brody mentioned, as well as technical obstacles like working with flexible technology, battery life issues, material quality, and simply making devices more wearable and less like an awkward addition.
“I think the notion of wearing technology is still unfamiliar with most people in the world, and it'll take some time to change that,” Vu said. “But really, the most important thing for all of us to figure out is what the truly compelling use cases are for wearables — we don't really have any right now.”
Watches and fitness bands have led the way thus far, with frontrunners Nike, Jawbone and Fitbit commanding about 70 percent of market share, according to SmarTech Senior Analyst Ian Forsyth. But even Nike is scaling back on its wearable hardware efforts, Fitbit faces a threatening lawsuit, and the iPhone’s new M7 sensing chip has the potential to significantly shrink the total opportunity.
“We’re at the intersection of helping people achieve their goals,” Brody said. “People are starting to realize (their fitness bands) are not making them more fit. People still struggle with how to integrate technology with user experience, and from that, how to influence user behavior.”
Beyond that, Forsyth believes that the materials available for high-quality products leave a lot to be desired and that it will take more research and development to find materials that perform and feel like conventional manufacturing materials.
Integrated within those materials are the sensors that bridge the technical and the personal, and questions live there too.
“The next generation devices will need to step up in terms of the range of sensors and the functionalities offered,” PARC’s Veres said. “In addition, user design and utility will be increasingly important. Of course we want the sensors inside each wearable to perform a necessary function, but we want the experience to be positive for the consumer — and for the information to be useable.
“This is where the Internet of things comes into play,” he continued. “It has to be seamlessly connected — the sensors, the data collection, the usefulness of the data in daily life. We want these interactions, of the wearable or device with the person, to be easy to digest, easy to make behavioral change, if necessary. We still have to figure out the use scenarios that will let you get personal experience and personal benefits without too much need for spending time with configurations.”
With 3D printing’s shift over the last three years from rapid prototypes to rapid manufacturing, there is hope that such seamless integration could be achieved through a 3D scanner that would be able to collect the dimensions of each consumer’s face, for example, and then design within software a product that exactly fits to the facial dimensions, Forsyth said.
“For 3D printing, the most exciting opportunities in wearable electronics are about customization from a consumer standpoint,” he said. “... Customization is the value driver.”
Once ready for the printer, though, volume becomes a critical concern. The 3D printing technology’s current capabilities include making low volumes of plastic parts with significant manufacturing efficiencies, Forsyth noted; printing of metal parts is coming in the future.
As Brody noted, this scenario is great for start-ups — to a point.
Forsyth reminded that total sales of wearable devices last year amounted to 2.5 million to 3 million, while 3D printing capabilities are best suited for production of fewer than 100,000 products, especially for those that are small and complicated.
“When you talk about that kind of volume, you’re getting out of the realm of 3D printing,” he said. “It’s hard for me to believe 3D printing will be the go-to manufacturing option for wearable electronics, but it’s a different story for niche products.”
With the types of 3D printers that could print wearable electronic properties still higher priced — and those printing metal up to $1 million — he expects the first applications of 3D printing and wearable electronics to come from the larger firms that can invest in multiple high-performance 3D printers, like Nike, Adidas and Samsung.
Nevertheless, great ideas are bound to be pioneered by entrepreneurs, and “Kickstarter is probably the most important community for nurturing (start-ups),” Brody said. “Ultimately I believe many are coming from the same group of peers, and they will intermingle with each other.”
As far as the industries leading into that foray, fitness and electronics (think smartwatches and other smartphone peripherals) have already begun to establish themselves, and the applications are bountiful for health care.
“Personal fitness seems to be the leading industry in wearables now, mostly because they are the most human-interactive applications,” Veres said, “but we are literally just at the tipping point. Automotive, aerospace and other manufacturing-heavy industries are doing related technologies that consumers will start to see in the near future.”
Also, a number of technology-driven start-ups are developing unique concepts like stretchable or flexible materials or components such as low-power microchips that could be implemented in wearables across varied industries, he added.
Forsyth noted that the textiles industry seems farther away from reaching a mass market, but that assessment doesn’t lessen the potential that lies there, at least in the eyes of IBM’s Brody.
“So far wearables have been dominated by startups, and they’ve been treated as electronics products,” he said. “The single most important industry that will drive the growth of wearables forward is going to be fashion.”
It was no accident that the new head of Apple retail came from British fashion brand Burberry, Brody noted. “Any business that knows how to sell a cotton T-shirt for $200 is worth learning from.”
The beauty could either be in the fact that wearable electronics are undetectable or else they’re very, very visible — and embraced by the fashion world.
If manufacturers can overcome the challenges facing wearable electronics — if there’s no tried-and-true model to follow, “there are at least plenty of mistakes we can all start to learn from,” Vu commented — and if the products themselves catch on as experts predict, there awaits a potential market that most analysts forecast at approximately $3 billion, Forsyth said, with the total market growing to a pretty substantial amount in five years fueled by advances in computer technology and large brands adopting technologies.
Further down the road, he said analysts put the 2018 market value at $8 billion with a penetration of approximately 50 percent. Extrapolating a total opportunity in 10 years of $16 billion is more contentious among analysts, he noted.
“There’s a lot of value in wearable electronics to people who are active in social media,” he said. “I look at a high percentage of customers, 60 to 70 percent of hardcore social media users, eventually adopting wearable electronics.”
Forsyth also noted that the value of wearables would likely be recognized and adopted by 15 to 20 percent of younger generation corporate clients in 10 to 12 years to facilitate their work, as well as 10 to 12 percent of the total market of smartphone users by the 10-year mark.
“Ultimately most people will be carrying around or wearing wearable electronics,” Brody said.