The Biggest Name In Cutting Edge Wearable Tech Is... Warren Buffett?

Billionaire investor Warren Buffett, who prefers to keep tech companies at arm's length, may be willing to make an exception this time around. Richline Group, a Berkshire Hathaway Inc. BRK BRK company operating in the jewelry industry, is making a foray into the wearable market.

Jewelry Turns Smart

Richline came into the fold of Berkshire Hathaway in 2007 and by its own account is the nation's foremost, financially strong jewelry manufacturer, distributor and marketer. It is a vertically integrated company, engaged in processes ranging from alloy production to the creation of consumer jewelry brands.

A ZDNET report said the Richline Group would launch a smart jewelry line called Ela, or Elegant Lifeline Accessories, this spring. To start with, Richline would offer wristwear and then later expand to other product categories such as rings and earnings.

Related Link: The Wearable Tech Industry Will Be Worth More Than $71 Billion In 5 Years

How The Technology Works

Ela connects to iOS and Android devices using Bluetooth low energy and has self-tracking feature syncing with Apple Inc. AAPL Health and Alphabet Inc GOOG GOOGL's Google Health Kit. ZDNet quoted Richline product innovation manager Cliff Ulrich as saying, "The wearable also connects to the Ela app, through which you can create and share photos and other "memories" like special songs or a voice recording. The memories can be pre-loaded when giving it as a gift to someone else."

Ela also allows users to create alerts and when someone in our alert list is contacting us, the gem on the device will softly glow and vibrate. A user can set the device to glow a certain color for specific contacts or groups.

Can Richline's Ela Succeed?

Although the wearable market has some high-profile players, including Apple and Fitbit Inc FIT, it hasn't been faring well in recent times. IDC's estimates for the third-quarter show a mere 3.1 percent year-over-year increase in wearable market shipments.

Consequently, Richline is looking to project Ela as a wearable device that not only taps into consumers' growing interest in electronics, but also their interest in spending on "experiences." Ulrich said: "We wanted to create the modern day locket and allow people to store memories in their jewelry — If someone wants all the features in the world, they'll get a smartwatch. But we tried to create a much more emotional connection with a product, rather than being purely about the functionality."

Launch Details

Richline expects to launch Ela in April, with the smart jewelry made available in four different designs and various colors. The smart bracelet is priced between $195 and $295.

Against Buffett's Theme Of Staying Off Technology

Buffett has in the past stayed away from technology, shunning it on the grounds that he doesn't understand it. This, coming from an astute investor is likely to raise quite a few eyebrows. ZDNet quoted a Fortune article penned by Buffett in November 1999, where he mentioned that reasons why he doesn't invest in tech stocks:

• The relatively limited longevity and defensibility of competitive advantage.
• The difficulty of identifying the few winners in advance and being able to buy them at reasonable prices.

That said, Buffett has made exceptions to his tech-shunning philosophy. Recently, Buffett increased his stake in Apple by nearly four times, with the company's stock now being the seventh largest holding of Berkshire Hathaway. Richline's plunge into the smart jewelry market may prompt the unwitting Buffett to take a second look at the sector. If at all Richline's venture proves successful, the tech sector could count itself blessed to have received the approval of a longstanding critic.

Image Credit: By USA White House - https://www.whitehouse.gov/photos-and-video/video/2011/02/16/2010-presidential-medal-freedom-recipient-warren-buffett, Public Domain, via Wikimedia Commons