EL SEGUNDO, CA: The future for wearables lies not in the consumer electronics sector but in the fashion category and, accordingly, they have some way to go before they enter the consumer mainstream.

As the excitement over the latest round of smartwatch launches fades, insights provider IHS observed that for them to become a legitimate category their usability would have to be improved "and the secret sauce in this effort is an upgrade in design centred on the use of flexible displays".

It noted that developments in flexible displays were opening up new opportunities for wearable devices, enabling the kind of design innovations seen at IFA 2014, the consumer electronics trade show held recently in Berlin.

As an indicator of the future development of this market, it predicted that the display panel market for all types of wearable electronic items was set to grow from around $300m in 2014 to $22.7bn by 2023, while shipments would increase from 54m to 800m over the same period.

"Wearables are best viewed as functional fashion accessories rather than as electronic goods," said Sweta Dash, senior director for research and display at insights provider IHS. "But because the fashion accessory market is determined by design rather than by simple function, wearable products such as smartwatches must be adaptable to various forms including squares, circles or even ovals."

That flexibility in form factor and design was one of three elements she suggested were essential for wearables display panels, the other two being outdoor visibility and low power consumption.

While she anticipated that most of the next wave of wearable products would come from smartwatch computing, she felt that most current products were not ready for mainstream consumer adoption, largely because of current pricing.

She argued that a clear value proposition was needed before consumers would replace traditional watches with the design and applications provided by a new generation of timepieces.

Separately, the Consumer Electronics Association highlighted five cutting-edge technologies it expected to significantly impact the consumer electronics industry, including Big Data, the rise of the machines (Internet of Things, robotics and driverless cars), digital health and the quantified self, entertainment and immersive content including augmented reality, and business models in the innovation economy.

Data sourced from IHS, Consumer Electronics Association; additional content by Warc staff