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Samsung takes shaky first step into wearable future

Thursday, 5 Sep 2013 | 2:35 AM ET
Matt Clinch | CNBC

On a warm late summer's evening in the German capital of Berlin, hundreds gathered at the Tempodrom - a venue resembling a mix between a cathedral and a circus tent. The packed out audience was here to worship a new product - the first smartwatch from one of the major OEMs (original equipment manufacturers).

But it didn't quite work out that way.

Samsung released its much anticipated new smartwatch to a dubious response from analysts and technology experts.

"Bulky form factor, poor battery life, and questionable utility hobble today's smart watches," said Cosmin Laslau, a mobile analyst from Lux Research.

"Samsung has worked quickly to plant its stake in the ground with the Galaxy Gear, beating rivals like Apple and Google to market, but this first generation product hasn't cracked the smartwatch code."

(Read more: Samsung reveals smartwatch, new Galaxy Note)

Laslau wasn't alone, Daniel Matte, mobile analyst at Canalys told CNBC that the $299 price point, low battery life, limited interoperability and significant size and weight were all reasons why the product will be shunned by the public.

But Matte remains more positive on Samsung's future, telling CNBC that the group will update and improve on this product at frequent points in its life cycle.

"I believe (Samsung) also deliberately tried to lower expectations, implying it was a first attempt," he said.

"Smart bands/watches should be much better in the future. Integrating new types of health and fitness sensors will be critical."

(Read More: Bottom line on Samsung smartwatch: No 'game changer')

The Korean tech giant itself told CNBC there was much more to come as it takes a new step towards wearable gadgets. "This is just the beginning," Dale Ann, Samsung's product planner on the new Galaxy Gear smartwatch told CNBC. "I think (wearables) will be the future, we will put a lot of effort into it."

Sascha Pallenberg, a tech blogger living in Taiwan said the inclusion of a flexible glass display in future models should ensure it's not just a niche product for owners of Samsung's hi-end smartphone products.

"No-one knows what will happen with the wearable technology market," he told CNBC, adding that with some improvement - and new releases by other majors - 2014 could be the year of smartwatches, and wearable technology in general.

Samsung and Apple gear up for new battle?
Bryan Ma, associate vice president at IDC Asia Pacific, discusses Samsung and Apple and the next possible wave of innovation as both groups are expected to launch new products shortly.

Statistics from any number of research firms still predict a rosy future for smartwatches and wearable technology in general. Research firm Canalys predicts 5 million smartwatches will be shipped next year, a 900 percent increase on 2013 numbers. Strategy Analytics, meanwhile, forecasts global smartwatch shipments will grow from 1 million units in 2013 to 7 million in 2014. In money terms, Credit Suisse expects the wearable tech industry to grow from $3-to-$5 billion today to $50 billion within five years.

(Read More: Smartwatch rivals to Apple and Samsung)

And whether Samsung's first step in this new sector was disappointing or not, new research from Citi shows that major mobile makers would be best placed to find new devices to sell to gadget-hungry consumers. In July, Citi argued that penetration for smartphones is between 75-85 percent in developed markets, meaning a saturation point could be reached as early as 2014.

By CNBC.com's Matt Clinch. Follow him on Twitter @mattclinch81

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