Facebook is developing a smartwatch that will reportedly be used as a standalone talking device and will initially ship with Google’s Android OS.
Facebook (FB) is in the process of creating smartwatches that will compete with Apple Watch, Fitbit owned by Google, Huawei and others, The Information reported, citing anonymous sources.
The smartwatch from Facebook will reportedly have a built-in cellular connection, which will allow it to be used as a standalone talking device. The initial version will have an Android OS, but the report says Facebook wants to release its own operating system. In addition to the suite of apps: Facebook, Instagram, Messenger and WhatsApp, the watch can be integrated with health and fitness services such as Peloton (PTON).
Facebook hasn’t commented on these messages, but many analysts think the release of the smartwatch is logical for the company that makes Oculus virtual reality glasses and Portal video calling tablets.
In 2019, various sources announced Facebook’s plans to create smart glasses in partnership with Luxottica. While there is no confirmation of this, the source of information may be that one of the corporate Facebook teams is indeed working on a wearable device.
While smart device sales are a revenue-generating opportunity for Facebook, the company hasn’t done much in the business so far – Oculus and Portal do not make up a significant share of Facebook’s total revenue. However, Portal video calling devices have seen increased demand during the coronavirus pandemic. Facebook smartwatches may become more popular as it is one of the most popular gadgets among consumers around the world.
Be that as it may, Facebook’s smartwatches may face two key selling challenges: 1) competition and 2) privacy concerns.
For smartwatches from Facebook to gain popularity, the company will have to make a huge effort, since this market is dominated by the Apple Watch, sales of which even professional manufacturers of different smartwatches cannot compete.
For consumers, all factors will play a role: design, price, features, in order to gain significant market share, Facebook smartwatches will need to have distinctive advantages.
In addition, Facebook faces a lot of mistrust in the way it uses their data. So, Facebook criticized Apple for the fact that in the updates of the iOS operating system for users it will be possible to disable targeted advertising in applications. Facebook cited this as a risk to its future earnings, and Apple as one of its biggest competitors.
However, Facebook’s huge profits give it the opportunity to invest in new products that, in theory, could become new sources of revenue and profit.