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3 reasons Apple, Samsung watches could be a bust

(MoneyWatch) If reports are right, and that's always a question when discussing the future plans of companies, the next great battleground for consumer electronics companies won't be some improved version of television that will remove complexity from devices that were already so easy to use that adults could operate them. No, the revolution is coming for watches.

Apple (AAPL) is reported to be working on what has been popularly dubbed the iWatch, although it hasn't publicly acknowledged the project. Samsung has admitted that it, too, is working on a wrist device. And now, apparently, Google (GOOG) is working on wrist technology, which could well mean that Motorola would come out with a device.

But are wrist devices the next big thing? Will consumers gravitate to looking like  Dick Tracy comic strip characters using wrist communicators? Or will the mass market -- the one that ultimately counts in consumer electronics -- take a pass on adding yet another chunk of equipment?

The race to a wrist device seems in a way to have come out of nowhere. Apple is working on a wristwatch-like display unit that would either perform some functions similar to an iPhone or iPad, or that would connect to them. It might even tell the time. Samsung has admitting to working on a watch as well.

However, there is nothing new about a wrist device that goes beyond the functions of a watch. LG already has had a watch phone for more than a year. In some uses like scuba diving, specialty wrist computers with wireless connections to air tank pressure sensors have been around for years.

What you're seeing is not a sudden explosion of revolutionary inventiveness from the top smartphone and tablet makers, but an incremental development in the concept of wearable computers. For example, a recent report from ABI Research estimates that what it calls the GPS fitness watch market will pass $1 billion in sales this year. Google Glasses is a more inventive example of wearable computing. (Whether inventive will turn into popular has yet to be seen.)

But there are some factors that could make the smartwatch a less than robust market for the Samsungs, Apples, LGs and Googles of the world:

Screen size -- There is a limit to how big the screen of a watch can be before the owner looks like a dork. These will offer very little visual real estate. But the trend, in phones, at least, has been toward bigger screens. That's because it becomes harder and harder to do anything if you're squinting at text, images, or navigational icons. Think it can be frustrating at times trying to get the right point on a touch screen? Wait until you work in a small area like a watch face.

Existing extensions -- Smartphones already have Bluetooth extensions: Headsets. People can take calls and even use voice dialing so they don't have to take a phone out of their pockets. How would a watch offer a more elegant solution? Hold the thing up to your face? This works hand in hand with the screen size, as well, because most users would have to pull the phone out anyway to do much of what the devices offer.

Price -- According to that report from ABI Research, one of the popularity drivers for GPS fitness watches has already become cost. Consumers are already price sensitive. If that a similar factor develops for this other type of smartwatch, it could quickly put a crimp on how much additional revenue companies could see.

In other words, smartwatches as extensions to smartphones and tablets are hardly a done deal at the consumer level. Apple might be able to move a good number to its most rabid fans, but it will take much more for smartwatches to become the next "It" gadget.

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