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September 25, 2014
Reflecting on the Apple Watch launch – A window into the future for healthcare wearables?
By: Mikael Stenstrand

We recently saw the eagerly awaited launch of the Apple Watch and Apple making another strategic move, this time into the healthcare and wearables space. The Apple Watch followed the June launch of Apple’s Health App and Health Kit data cloud, and subsequent partnership with the EMR vendor Epic and the Mayo clinic.1 While not the first to launch in the Smart Watch area, Apple’s ability to change the rules of the game has many observers holding high expectations that Apple will, once again, turn an industry on its head.   

To date, the launch has had a somewhat muted response among healthcare industry observers and was rather over-shadowed by Apple’s announcement regarding the new iPhone6 /iOS8 and new mobile payments feature PAY. However, there are growing expectations for a mass market in health monitoring devices, complete with built-in clinically validated sensors, enabling patients & their healthcare providers to better manage healthcare and reduce costs.  

In line with this expectation, Apple has launched a device with a Heart Rate Sensor and two Fitness Apps tracking daily movement and calorie consumption that can link to their Apple Health Kit data cloud. From a health and wellness perspective it is similar to other watches that are available on the market. For example, the Samsung Gear and Moto360 also have a heart rate monitor. But many are expecting Apple to have more announcements in the future the healthcare space.

“Analysts” forecasts vary widely for the take up of the Apple Watch, but rather than being critical at this stage, we should look at the Apple Watch as giving us a window into what the future of healthcare wearables could look like. The Watch and Health Kit offer a cross-industry platform to accelerate future development of both add-on devices and apps. Together, these could potentially collect and connect meaningful data from vital signs with healthcare consumers and providers and help deliver improved patient and economic outcomes. Since the Apple Watch launch we have already seen Stanford and Duke Universities sign up to test the Health Kit in a healthcare setting against glucose and blood pressure monitoring.2

In the fitness wearables area, the Apple Watch is likely to accelerate the market, which the Consumer Electronics Association already estimates at growing 37% in 2014 to over $1B in the US alone, up from 9% in 2013.3,4

Beyond the Consumer market, it’s worth also considering the opportunities of Wearable devices in the enterprise setting. In our recent paper Putting Wearable Displays to Work in the Enterprise, we’ve explained why, in the short term, the opportunities for deploying wearable technologies are much bigger in an enterprise setting than in the consumer market. In the enterprise setting, we can see the benefits of wearables in assisting Healthcare Professionals and more effective monitoring of patients inside and outside of the healthcare setting. IDC estimated the US Clinical mobility market at $2.9B last year, and forecasts it growing to $5.4B in 2016 based on adoption of mobile solutions in the healthcare workplace.5

In another recent Accenture study, The Internet of Things for Consumers, Accenture asked consumers about their interest in some Internet of Things-powered devices, or smart devices. In this study only 4% of the respondents said they planned to buy a smart watch in the next year, while 55% said they would never buy one. In order for consumer uptake to move beyond gadget and fitness enthusiasts, these products need to offer real value to the average consumer in the same way smartphones have. It’s interesting to consider what difference the high profile launch of the Apple Watch may have made to this and speculate on what wave of innovations is likely to follow.

As we look at the consumer healthcare market, sitting at the intersection of the Life Sciences and Consumer Goods industries, it’s interesting to ask what impact healthcare wearables could make. Recent Parks Assoc. Research6 estimated connected personal healthcare monitoring devices were a $0.5B US market in 2013 forecast to grow to $1.5B by 2018, alongside a larger $1B US Market for connected fitness devices forecast to grow to $3.5B by 2018. While the faster adoption of the Watch into the fitness market is apparent, we anticipate a branching out into an even wider net of potential applications including diabetes, cardiovascular health, sleep, drug compliance, weight management, patient diaries etc. 

In the Life Sciences sector, we see the potential for healthcare wearables to be a tool used by healthcare professionals and patients (and potentially even be prescribed) alongside drugs and medical products. We anticipate Life Sciences companies increasingly incorporating these devices and platforms into their offerings in new innovative ways.

The Apple Watch launch is just the beginning of a journey of rapid innovation in healthcare wearables, with greater relevance and affordability expanding their reach into more mass markets and driving better health and economic outcomes in both the home and the healthcare setting – a truly game changing proposition.

  1. Apple health Kit Mayo Clinic Partnership
  2. Apple health Kit to be used in Stanford and Duke University Trials
  3. US Consumers Ownership of Wearable Fitness Devices trebled 2012-13 to 9% – CEA
  4. Forecast 37% Growth in US Sales of Wearable Fitness Devices in 2014 to over $1B – CEA
  5. IDC Clinical Mobility 2013-16
  6. Parks Associates Connected Health & Wellness

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