Intel just shut down its wearables division; here’s why

By Warren Miller, contributing writer

Wearable devices have been a key application area for the Internet of Things. Convenient, wearable devices that help with fitness ― and, more broadly, with a wide range of medical applications ― can provide the data needed to help us live longer and healthier lives. When aggregated over many users and processed using big-data analytics, we can get accurate, predictive information on our health or potential health risks.

These and many other wearable applications are still out there, but the market may not be growing as fast or as broadly as some device manufacturers would like. A source cited in a recent CNBC report claims that Intel folded its wearables division, responsible for the Intel fitness trackers and the Basis smartwatch, which Intel acquired for around $100 million in 2014. Basis has had a rocky history, with a recall of all Basis Peak watches in 2016 due to an overheating problem. The source also reported that Intel is increasing efforts within the New Technologies Group on other advanced applications such as augmented reality.

Intel folded its wearables division, responsible for the Intel fitness trackers and the Basis smartwatch. Image source: Pixabay.

Intel’s exit as a developer and manufacturer of smartwatches and fitness devices shouldn’t come as too much of a surprise. Often, device manufacturers dip their toe into a market, often one also served by their customers. This is usually just a way to gain significant market insight into the requirements of their own devices ― device requirements can be difficult respond to effectively, particularly if the market is growing and evolving quickly. Additionally, customers in these markets may not be very open-minded, even with key suppliers. Companies with deep pockets can afford to make these types of investments periodically; perhaps this is what Intel did in this case.

What might Intel have learned for its $100 million investment? Perhaps it learned that the big business isn’t going to be in the devices on our wrist. How much computing power is going to sit on our wrist anyway? Maybe they concluded, especially after seeing the power limitations demonstrated by the dramatic Basis overheating issues, that the wrist is only going to hold a simple sensor, wireless connection, and simple display — not much computing power is required. Intel probably wants to go after the market segments where significant computing power IS required, perhaps in the devices ‘up the chain’ from the smartwatch or fitness tracker.

The trick may be to figure out if there’s a place for a device other than a smartphone and the wearable sensor. If there is, and if it can incorporate significant augmented reality or other artificial intelligence applications, it will be a very compute-heavy device. Accessing sensor data in real time, processing it, augmenting it with big data from the cloud, and displaying it on smart glasses ― this probably requires more processing power and storage than you currently have on your laptop. Now that’s the type of market that Intel could tailor its technology to.