It's hard to believe that this pile of pieces could be worth so much money in such a short time period, but according to one analyst from SunTrust Robinson Humphrey, Robert S. Peck, that will be the case. He estimates that by 2017 Google will have an installed base of 64,500 users and new units should be selling for $349 and bring in $3.27 billion in non-hardware revenue. That is if only 65,000 people purchase them, which I believe is a modest number, especially if they cost $349, or roughly the cost of a high-end smartphone.
He believes that Google will sell the actual device at cost or slightly above, which makes sense when you think about. Google is in the advertising business and that is where they believe that they will make their money. We did a recent article where Google was awarded another Glass patent; this particular one offered a kind of pay-per-view advertising. When a wearer views an advertisement of any sort, Glass can detect your response to the ad by your eye movement – was it a positive response, negative response, or possibly a tearful response brought on from a past memory – Google can then charge their advertising partner for each response.
In an interview Venture Beat did with Robert Scoble (an early adopter that paid $1500 for his Glass), Scoble said:
I'm pretty excited about where Google's going – I think it will be a product that will stand up for decades as the launch of a new genre. It's a product that takes us to a new place … right now, this is best-of-breed.Advertisement
During the interview they said he flicked his Glass every 5 minutes as notifications came up, yet never lost his concentration, or looked away during the interview. A feature that did not escape Peck when he summed it up:
If there is one point investors should take away from Glass, it is that the technology is unique because it enables a person to perform actions while keeping their head up and continuing their first-person perspective.
The potential for real money is there for Google, where their "Glass" will always be half-full! Let us know if you are getting excited about picking up your Glass.