Intel’s Wearables Shutdown a Worrying Sign for Market

Intel has shut down its wearables division, according to a new report from CNBC.

Instead of building smartwatches and other products, Intel will shift more resources toward augmented reality (AR), said unidentified sources speaking to CNBC. That’s a radical change from three years ago, when the chip-making giant purchased Basis, which made wristwatch-based health trackers, as part of a bullish strategy to capture the wearables market.

This doesn’t mark a total retreat for Intel, which continues to partner with other brands on wearable projects. For example, TAG Heuer produces a smartwatch powered by an Intel processor. Nonetheless, it’s yet another sign that the wearables market as a whole is in a period of consolidation (or implosion, if you want to be unkind).

Just last week, for instance, a flurry of reports detailed the downfall of Jawbone, once a star player in the wearables market. According to Reuters, the cause of death was “overfunding,” although FitBit and Apple didn’t help things by introducing strong competitors into the marketplace.

FitBit, despite being one of the most prominent players in the space, finds itself at an inflection point. The company has restructured, its stock price has dipped, and last year’s holiday sales flagged. Any comeback rests on the success of its next smartwatch, a device that will reportedly include an array of biometric sensors and GPS tracking.

As with smartphones, it seems that Apple and Google are dictating much of the current wearables market; both firms have the talent and money to keep iterating on their respective designs for years to come. If other players fail to stay in that market, it only gives the two tech giants a greater degree of control.

For tech pros who don’t work for Apple and Google, but are interested in wearables as a platform for development, this consolidation in the market raises some interesting questions. More viable competitors make things more interesting; but with more platforms comes a greater likelihood that a percentage of developers and other tech pros might end up backing something that comes to a premature end, taking their time and effort with it.

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