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As Apple rolled out their new smartwatch it has been revealed that Australians are increasingly embracing the use of smartwatches, even as smartphone sales begin to falter, according to a new survey by the Sydney-based Telsyte market research outfit.Indeed smartwatch sales
Down Under grew by 89 percent in the six months to June 30, compared to the
same period in 2015, and now make up one third of the smart wearable device
category, Telsyte says.

Overall, more than 1 million “smart wearable” devices were sold over
the six months. Apple Watch was the top seller, snaring  more than 50
percent of the Australian smartwatch market, followed by Samsung’s Gear and
Fitbit Blaze models.

Telsyte predicts that by 2020 around 37 percent of Australians will be
flaunting a “smart wearable” – which could be either a smartwatch or
smart fitness band – with arrival of a second-generation Apple Watch helping to
push the trend.

Says Foad Fadaghi, Telsyte MD: “As smartphone replacement cycles have
lengthened, consumers are turning to other gadgets and smartwatches have
started to capture the imagination. We might be seeing the beginning of a
substitution effect where consumers are choosing a smartwatch over a new
smartphone.” Other factors driving these trends, according to Telsyte,
include:

 More Aussies are focusing on health and fitness, with many upgrading to
smartwatches from fitness bands from makers including Fitbit and Garmin. For
instance, Telsyte research suggests that 47 percent of smart wearable users
exercise a minimum 30 minutes walking each day, compared to 30 percent for the
general public;

 Price reductions by some makers, along with the development of more
carrier channels; and

 Development of mobile contract-free payment systems able to use a
smartwatch, with examples including Android Pay, Samsung Pay and Apple Pay –
the latter currently only promoted by one Aussie bank, the ANZ, though the
other Big Three are looking to push Apple into a deal that would be favourable
to them.

Meanwhile smartphone sales in the first half were almost flat, up just 3.8pc,
with 3.8 million units sold, compared with 3.7 milli on in the same period last
year. Market leaders Samsung, Apple and Huawei  took 79pc of the market
between them.

Telsyte predicts Apple sales will bounce back in H2 following this week’s
expected arrival of the iPhone 7, leading to expected price cuts on older Apple
models.