Microsoft jumps into the growing market for wearables

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Published: November 3, 2014 5:15:42 AM

Microsoft is joining the companies who see wearables as a way into the wellness business without all the red tape that comes from being a true medical company.

Microsoft has a place on desks, in living rooms and pockets. Now, like many other big technology companies, Microsoft believes it belongs on wrists. The company has created a wrist-worn fitness device, Microsoft Band, and a related online service, Microsoft Health, that will analyse the data from the band and other devices to help people with their fitness goals.

Microsoft is joining a stampede of companies creating wearable technology products for collecting personal health and exercise data. Technology companies see wearables as a way into the huge wellness business without all the red tape that comes from being a true medical company.

Microsoft’s black rubber bracelet resembles other products that have come before it. It contains a display that will show text messages from a cellphone, Facebook alerts and even bar codes that allow people to pay for coffee at a Starbucks from their wrists. Sensors in the device will continuously track heart rate, sleep quality and calories burned.

The band is a departure for Microsoft in many respects, though, brimming with technologies often available only in more expensive products. For instance, the band includes GPS satellite tracking. The inclusion of GPS means runners who want to track distance only need to wear the band—they do not need to carry their cellphones.

What is more, Microsoft is charging $199 for the device. Apple’s Apple Watch, due out sometime next year, will start at $349 and require a phone for GPS tracking. Fitbit, a leader in wearable fitness devices, recently announced a watch with GPS called Surge, available early next year, that will cost $250.

And, in an unusual move for a company often criticised for announcing products months before it actually ships them, Microsoft began selling the band through its website and retail stores last week. “We don’t think there’s any other device with this level of functionality,” said Yusuf Mehdi, a corporate vice president for devices and studios, in a demonstration of the device on Microsoft’s campus.

There is much Microsoft has to still prove for the device to be called successful. Its heart rate tracking has to be accurate, something other wrist-based devices have struggled to do. But more important, the oodles of data the device collects will need to create useful health insights. While there has been great curiosity from consumers about wearable technologies, many people seem to lose interest in them once the novelty wears off. In a recent survey, PricewaterhouseCoopers found that about a third of respondents who purchased a wearable device more than a year ago now say they no longer use it or do so infrequently.

Furthermore, Microsoft will have to work hard to demonstrate its relevance in a category in which it has no pedigree. “I’m not sure Microsoft has a brand that speaks to fitness people per se,” said James McQuivey, an analyst at Forrester Research, a technology research firm. But Microsoft has more credibility in cloud computing and the development of sophisticated algorithms that could help consumers figure out how to use their health data. The company says users of Microsoft Health will be able to upload data from the company’s band and other devices, along with information from calendar programmes like Microsoft Outlook.

With that data, Microsoft will then be able to tell them how their fitness performance varies relative to their work schedule and whether the number of meetings during the day affects sleep quality. Microsoft said it was working with other wearable device companies and app makers, including Jawbone, MapMyFitness and RunKeeper, to share data between the different products. The Microsoft Health app, which will wirelessly collect data from the company’s fitness band, will work on Apple and Android smartphones, along with Microsoft’s own Windows Phone.

Microsoft will have a formidable competitor in Apple, a company that has managed to outflank it again and again in mobile devices. Apple Watch is a more ambitious effort to cater to both fitness enthusiasts and people who wear luxury watches.

“We’re not trying to replace your watch,” Mehdi of Microsoft said. “This is prioritising function over form.”

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