AI wearable devices face privacy backlash as Oura delays IPO

Two years ago, Bella Nowroozi was on a date at the mall when she noticed something strange: a flashing light on her partner’s glasses.

The 24-year-old master’s student immediately recognized the frames as the Meta Ray-Ban smart glasses she had seen on social media. She told him to delete the recordings.

“Honestly, I was pretty shocked,” Nowroozi told CNBC, reflecting on the interaction. “I had never really experienced anything like that before. I was also afraid of going on dates after that as openly as before.”

Apple, Google, Meta and a swarm of other tech competitors are betting that new artificial intelligence wearables in the form of glasses, rings, charms and pendants can push the market toward its category-defining moment. But as gadgets gain notoriety, they also face privacy backlash and doubts about whether the technology is beneficial enough to become a fixture of daily life.

Meta made a splash last week with the unveiling of its Tamagotchi-like Muse Charm, a custom case for its personal agent app that quickly topped the list of free apps in Apple’s iOS App Store. The company has continued to release new iterations of its Meta Ray-Ban AI glasses and offers a range of models at different price points.

This week, OpenAI rolled out its own personal assistant called Dots. The ChatGPT maker is also working with iPhone designer Jony Ive on consumer devices, but its first offering doesn’t appear to be a wearable, according to Bloomberg. Apple presented a preview of its latest devices in early September, with AI features on the Watch Series 12 that will listen to your conversations.

In addition to the plethora of devices available, the market this week seemed poised to continue its momentum with the debut of smart ring maker Oura.

But on Tuesday, the company delayed its planned IPO at the last minute, despite strong demand for its products.

Oura cited “uncertainty in the IPO market” as the reason for the move, but some analysts were skeptical.

“I really believe there’s something else that’s causing them to pull out of the IPO, and I don’t think it’s the market,” said Anshel Sag, principal analyst at Moor Insights & Strategy. “I just can’t figure out what it is.”

“The fact that they’re coming out of this IPO is a little weird,” he said.

Branding issues

Meta faces pushback over its smart glasses, dubbed “evil glasses” on social media because of their discreet cameras that can be used for harassment and other bad behavior.

A social media user said a man took photos of her on a date without her permission. Another said a Facebook Marketplace shopper took unauthorized videos of her and her children. Meta’s own ad campaign featuring Kylie Jenner filming her daily life has sparked further criticism over the surveillance nature of the videos.

Meta did not immediately respond to CNBC’s request for comment.

Gil Luria, an analyst at DA Davidson, said growing resistance to camera-equipped glasses was an uphill battle to overcome.

“It’s over for now,” Luria said. “We’re going to have to revisit this in 10 years.”

When Luria first gave the glasses to her teenage twins last year, they were “super excited.” He now says they “wouldn’t be caught dead in it.”

Last month, Meta unveiled a camera-less smart glasses option.

The explosion of wearables couldn’t come at a more critical time as the political debate over the security risks of AI intensifies in Washington and the blowback takes center stage ahead of the November midterm elections.

Far from the cute, fuzzy appearance of Meta’s Muse character called Jolly, sprawling data centers have become the visual symbol of opposition to AI in the United States. Many argue that wearables and other devices that constantly listen or record have become an extension of this perceived state of surveillance.

Flock Safety’s license plate scanners are being vandalized and cities have ended their contracts with the company following community outcry. Smart glasses have been banned from gyms and other places due to privacy concerns.

In February, the judge at the Meta social media addiction trial in Los Angeles threatened to detain anyone using AI smart glasses during CEO Mark Zuckerberg’s contempt of court testimony. Several people escorting Zuckerberg to court wore Meta Ray-Ban AI glasses.

“Their added value must overcome the perception that AI is a technology that people oppose,” Sag said. “It must be more useful and helpful than people’s apprehensions about it.”

Design and execution

GPS has beamed maps onto a screen, the smartphone has created a pocket-sized personal computer, and AI promises to bring efficiency and automation to everyday life.

New gadgets in the wearables market are competing to create a new device category, but today’s most futuristic gadgets don’t necessarily match what the consumer wants, said Avi Greengart, founder and tech analyst at market research firm Techsponential.

From sleep measurements to exercise tracking and accident detection, health wearables have shown tremendous promise in a market cornered by big tech giants like Apple and Google, and even the startup Oura. Accessibility features added to Apple AirPods turn the popular headphones into hearing aids, Greengart said.

But some emerging AI technologies, including pins and pendants, have faced significant design and execution hurdles.

Greengart pointed to the Rabbit r1 personal assistant, which lacked use cases distinct from those of the smartphone and faced technical and hardware issues. Another failed competitor was the Humane AI Pin, which was discontinued last year following poor customer reviews.

“If you force someone to spend $700 on a device that overheats, has a user interface that doesn’t work in the sun, has poor battery life, unless what it does is magic, it’s not going to work,” Greengart said.

Nowroozi, whose sister owns a pair of Meta glasses, is hesitant to jump on the AI ​​wearable device wave.

“I don’t really see how that would really be any different than what a phone could do,” she said.