With wearable electronics quickly becoming the fashion these days, demand for batteries to power smart watches, wearable health monitors, and smart glasses will increase tenfold over the next four years, according to an IHS report.
Worldwide revenue for wearable electronics batteries is expected to jump from $6 million in 2014 to $77 million in 2018. Revenue growth will be buoyed by annual shipments for wearable electronic devices, which will reach 56 million units by 2018, according to the IHS Power & Energy report (subscription required).
"Wearable electronics will be the key to sustaining the current very-high-growth levels of battery revenue in consumer electronics,” Thomas McAlpine, a power supply and storage component analyst for IHS, said in a press release. He predicted a boost in shipments for "products geared toward an active lifestyle combining advanced technological trends in miniature computing with newly smart consumer imperatives in fitness and fashion," including smart watches and smart glass products, such as Google Glass, slated for release this year.
OEMs tend to prefer lithium polymer batteries over lithium ion batteries, since they are lighter and can be designed into a wider range of applications. As a result, lithium polymer batteries will account for 73% of worldwide revenue of wearable electronics batteries in 2018, the report says.
Though wearable electronics is an emerging market, smartphones and tablets is still driving the majority of revenue growth in the lithium battery market for portable electronics. Shipments of smartphones and tablet PCs are expected to grow 46% from 2013 to 2015 but then decline, IHS said. That drop, coupled with ASP price erosion of lithium battery cells, will put the brakes on growth in the overall lithium battery market for portable consumer electronics, according to the report.
As a result, McAlpine said, new applications are critical to the lithium battery market's overall health. "Lithium batteries will remain an integral component for innovation in consumer electronics. But to achieve sustained market growth, new wearable electronics and other devices need to be introduced and adopted by the mass market, similar to what is occurring now in recently emerging product categories."