Doppler Labs faces the same challenge of every hardware startup: It needs to find customers.
The company created a pair of wireless headphones meant not just to play music but augment the soundscape around you. I found them handy at tuning out the background noise when I tried a pair in a crowded bar, but I didn’t spend $300 for them when they came to market as Here One earlier this year. Since then, Doppler has sold “tens of thousands” of units–making them neither a total flop nor a hit.
But in the meantime, Doppler discovered something interesting. One in three of its customers were buying Here One for hearing health, to deal with existing issues like hearing loss and tinnitus. In other words, the Here One was pitching super-hero hearing, but the headphones found true traction with the hard of hearing. To a third of customers, Here One wasn’t a taste of a future of in-ear assistants like from the movie Her. It was just a relatively low-price hearing aid in a world where many alternatives cost $4,000 or more.
Doppler Labs is no outlier. Many tech companies that have struggled to sell wearables to consumers: A third of buyers don’t wear their Fitbits after a six months, and even the most hyped wearable product, the Apple Watch, has failed to reach mainstream status. Yet, as the technology within these products has matured, some companies are realizing that there is a huge market in wearables after all–just not the one they expected.
For instance, in the past few months, Google’s health-focused spin-off Verily has announced a smartwatch optimized for medical studies. Apple is rumored to be working on an Apple Watch-compatible insulin pump. And most recently, Apple has teamed up with Cochlear, the company behind Cochlear implants, to develop a new, lower-power Bluetooth signal, which could send iOS phone messages and alerts right into someone’s skull.
Hearing aids themselves aren’t a big enough market to feed a Google or Apple, of course, but they still represent a $4.5 billion business in the U.S. alone. And that number could soon grow, because this week the Senate passed a new bill to allow the marketing of over-the-counter hearing aids by consumer electronics brands like Bose and Beats. Meanwhile, the medical equipment industry in general is the larger cash cow up for grabs, estimated to reach $500 billion by 2020. The greater healthcare industry is worth $3 trillion. It’s the same size the global fashion industry, perhaps a bit ironically, given that Apple originally touted the Apple Watch as a style play and Google’s Glass wearable had its moment in Vogue.
As for what this means for the smaller hardware companies in the world? For Doppler Labs cofounder and CEO Noah Kraft, the medicalization of wearables could fundamentally change the future of his company. One in eight Americans suffers from some form of hearing loss. With the law now on his side, he’s looking toward Q4 and planning an advertising budget to see how deep the hearing aid well might go.
As for the next generation of Doppler’s high-tech earbuds, planned for a potential release in late 2018, they’re being designed first and foremost with a focus on battery life–to be always on, just like you’d expect a traditional hearing aid to be.