“Trip Chowdhry of Global Equities Research today weighs in on Apple’s forthcoming wearable, Apple Watch, with another missive culling his observations of the developer perspective on the device,” Tiernan Ray reports for Barron’s.
“Chowdhry writes that he and staff have attended six ‘Apple Watch-Kit hackathons’ over ‘the past few months,’ and writes that the company may have 100,000 applications ready for the device when it comes out in April,” Ray reports. “Chowdhry makes the rather eye-opening claim that ‘The $350 price of Apple Watch appears to be a non-issue’ because ‘On an average an Apple Watch user will have 100 Apps installed, and one way to think about it is that the consumer is getting 100 devices for $350… i.e. $3.50 per device.‘”
Ray reports, “Chowdhry makes one of the largest pitches for the sales of the device thus far, predicting Apple may sell as many as 42 million by December, arguing that “Since Apple Watch extends iPhone functionality and provides user convenience with ‘Glance’ and ‘Notifications’ to an iPhone User, almost every current iPhone user, which are about 350 million users, will also be an Apple Watch user.'”
Read more in the full article here.
i’m sorry but i’m just not convinced this will be a success. My feeling is this will workout for apple like the mac cube did. Innovative, beautiful but too pricey
Comcast offered me about 200 cable channels for ONLY $100. Like most other television watchers i only watched about 8. In my opinion the other 192 channels were pure crap.
Using this analogy, “‘On average an Apple Watch user will have 100 Apps installed, and one way to think about it is that the consumer is getting 100 devices for $350… i.e. $3.50 per device.‘” to justify a $350 price is way off target.
i personally think an entry price of $350 is good value (with what I know about the Apple Watch today). I just really dislike the analogy.
Your analogy is the one that’s off. Comcast sells a bundle and you have to take all 200 channels to get the 8 you want. There will be tens of thousands of apps, and the author is saying that the average person will have 100 apps that **they have chosen because they like them and find them useful** That’s 100% of what you want, not 4% like Comcast. Any crap you put on the watch will be crap that you put there. Of course, 100 may be a bit many, as I speculate that most folks use 20-30.
Jim
I agree with you i your interpretation. But I am not sure where Chowdry gets 100 apps per A-Watch. Seems a bit fantastic to me. I agree that $350 price is not exorbitant, but not for that silly reason.
Hey for Xmas I got a fitbit. Cost $92. It’s OK, but really a on trick pony – not an on the wrist computer. Doesn’t even know the difference between a run and the elliptical.
The Apple Watch will be at least 10x as powerful – so at only 3.5 X the price it is a deal.
You’re right, but it’s hard to believe I’ll be using more than a select handful of apps. The author also apparently assumes they’ll be free, as he’s not allocating any cost other than the watch itself.
Maybe not but count me in for 4 of them
You are certainly entitled to your opinion. But the Cube was a somewhat different beast. It was underpowered and overpriced relative to its own Mac competition. The Apple Watch has very little, if any, real competition. You either want one, or you don’t. If you do, then price is the only obstacle, and the availability of the $350 entry level model makes it accessible to a large number of people. Relative to other smart watches, the Apple Watch will sell many times more units in just the first few months.
The Cube and the Apple Watch do have one major similarity. They both represent pathfinder R&D products for Apple. The Cube represented Apple’s first commercial attempt to achieve their goal of a very quiet, fabless computer. The Apple Watch represents Apple’s first commercial attempt at a highly capable, wearable computer (you could make argument for the iPhone, but I would classify it as portable, not truly wearable, and the iPod shuffle and nano are much more limited in capability).
I think this is the key insight. People won’t be saying “Which smartwatch should I get?” They’ll be saying “Do I want an Apple Watch or not?” And the ones who do will only then consider the price, and $350 is not going to stop them.
I think Apple will sell a staggering number of them. And I guarantee that once you have the ability to feel a loved one’s heartbeat being tapped out on your wrist, well that’s a level of intimacy and comfort beyond expression, and people will simply *want* that.
Correction: “fanless”, not “fabless” I make more mistakes typing on an iPad.
Steve Jobs was great at making insanely great products. Tim Cook’s strength is supply chain management and infrastructure.
It would appear that Cook is building on a legacy and taking it to a level that few could have imagined.
yea but is that level up or down?
History says it’s not wise to bet against Cook.
I have seen a lot of good things happen at Apple under Tim Cook’s leadership. Not everything has been great, but it is worth remembering that Steve Jobs was not perfect, either. Sometimes the path to insanely great products is paved with a few clunkers and missteps. You have to take risks to make progress, and risk is accompanied by the occasional failure.
IMO, there has been positive progress in key Apple strengths, such as the iPhone, iPad, and Mac laptops, in particular. The progress in desktop computers – iMac, mini, and Mac Pro, has been far less impressive. The Mac Pro was rolled out to hype and thunder, but I have not heard anything about it since then. I would like to learn more about the Mac Pro factory in the U.S.
The software area is my biggest source of concern – mainly bugs in key areas of OS X and iOS (e.g., WiFi) and an overall lack of clarity in the functional unity of the OS/app ecosystem. I suspect that most people do not know what to do with iCloud, and the iTunes app still needs work. It is time for Apple to rally and refocus on user experience, simplicity, and reliability in its software products. But I believe that these are short term growing pains that will improve as Apple refines the new functionality within OS X and iOS and clarifies/simplifies user interaction with iCloud.
I am hopeful that Apple is headed in the right direction and that five or ten years from now, Cook’s record and reputation will be lauded on its own merits as a worthy successor to Steve Jobs.
Now, that’s a more realistic prediction, based on reality (not based on an “analyst” pulling a high-sounding number out of their ass).
But it will likely be even higher, because if there are “about 350 million users” (potential Apple Watch customers) now, there will be at least 500 million by the end of 2015. Apple sold almost 75 million new iPhones on just one quarter. The 42 million prediction is less than 10% of potential customers, people who are already enthusiastic Apple customers (an easy sale).
The biggest constraint for Apple will be the capacity to produce Apple Watch at a fast enough rate to meet demand.
Apple sold 75 million iPhones after proving their phones to customers and potential customers over several years.
There is no way Apple will sell 42 million Watches in the first year. Every iPhone user is not going to become a watch customer.
Apple Watch will be a huge success, but some expectations are beyond unrealistic. 10 million sold in the first year before most people have really figured out what it would do for them would be amazing (and of course Apple is often amazing).
Also, smartphones are a necessity for most people but I don’t think anyone is arguing that the Apple Watch will be a necessity any time soon if ever. Sales will not be comparable.
Even sales of iPads have not kept up with iPhones. Really, nothing has sales like iPhones.
Smartphones weren’t “a necessity for most people” when the iPhone was introduced, either. Considering humanity as a whole, come to think on it, they still aren’t.
Convenient, though.
Apple didn’t sell 45 million smartphones when they first came out either. So you are making the same case I am.
“Really, nothing has sales like iPhones.”
toothpicks
kleenex
car tires
bubblegum
razor blades
big macs
bullets
screws and nails
pencils…
Duly noted.
100,000 apps? Wow that’ll be one for every buyer…!!
(J/K, J/K, honest!! Too low a hanging fruit to resist. They’ll doubtless outsell Android Wear to date in the the first week or so. They just won’t be selling one to me or most people I know with iPhones or otherwise.)
100,000 apps and the pundits will claim 99.9% are completely useless. With Apple’s market cap as high as it is, there are surely an awful lot of iHaters hoping AppleWatch will be a huge failure and they’re praying Tim Cook will be proven completely incompetent.
Self-proclaimed prophets hate to be proven wrong and Apple keeps butt-hurting their pride. Apple builds some pretty good products but their key advantage seems to be knowing in a general sense what appeals to consumers. This is what the tech and financial pundits don’t quite understand.
Take that gloogle glass. wearable my ass.
Instead of wearable, there should be a “smashable” category for things like Google Glass.
I will be buying 5 Apple Watches the minute they become available. Just about everyone I know wants one. Selling 42 million is not at all a reach.
i’d like to buy one
Again…. This is the same guy (Chowdry) who just a few months ago wanted to canTim Cook.
See:
http://seekingalpha.com/article/2098113-the-most-absurd-apple-analysis-ever
People are allowed to change their minds.
No they are not!!!
Well…ok. Maybe they can.
Based on the history of Apple devices I am still going to wait for Apple Watch 2.0
I was driving yesterday and heard my inaccessible iPhone ring. I thought, “If I had on the Apple Watch, I could see who’s calling.”
Yeah, a day-one no-brainer purchase.