Apple Watch is a radical shift in Apple’s strategy

“If it succeeds, Apple Watch will become the company’s fourth major new product category since the turn of the millennium — following in the footsteps of the iPod, iPhone, and iPad that preceded it,” Sam Mattera writes for The Motley Fool. “More than just a different branding (“Apple” replacing ‘i’), there are two stark differences between the Watch and Apple’s other product categories — differences that suggest a more fundamental shift in strategy.

“Although Apple’s products have long been defined by their ability to work together, Apple Watch is the company’s first major product that’s basically an expensive accessory,” Mattera writes. “Without a tethered iPhone, it’s largely useless. This could be a limitation with the technology itself rather than an intentional design decision — virtually every other smartwatch that has been released (at least so far) faces the same limitation — but it still serves to set Apple Watch apart from the company’s other products.”

“As a consequence, it does not — literally by definition — cannibalize Apple’s other product categories. In the past, Apple has not been shy about targeting its own products (‘If you don’t cannibalize yourself, someone else will,’ Steve Jobs famously said) but Watch is a dramatic departure from that philosophy,” Mattera writes. “Indeed, if it’s successful, it will serve to protect the iPhone rather than cannibalize it. Once a customer purchases Apple Watch (perhaps for thousands of dollars), they will be more locked into the company’s ecosystem than ever before — abandoning the iPhone would mean parting with an expensive accessory.”

Read more in the full article here.

MacDailyNews Take: Apple Watch has onboard storage and can play music via Bluetooth earphones. It does not require an iPhone to be prpesent to perform this function. Apple Watch also contains an accelerometer, so it can track the distance a wearer has traveled. It can also tell you your pulse – without stopping! So – and this is just one example – a runner does not require an iPhone to be present in order to listen to music and track their distance.

Apple Watch requires an iPhone in order to load apps, music, and for other features, but it’s disingenuous to insinuate that Apple Watch is “largely useless” without an iPhone present. Apple has sold hundreds of millions of conventional iPods. They weren’t useless. Among many other functions – again, this is just one example – Apple Watch is an iPod on your wrist – no iPhone required to be present in order to play music, track distance, and monitor your heartbeat.

17 Comments

  1. It’s not a radical shift. If so, then so were iPods, iPhones and iPads. Apple is just tapping relative electronic markets – and doing a great job of it, too.

  2. I think that the MDN take is right. This is in some ways a replacement for the iPod, the classic version of which they quietly retired on the same day the unveiled the watch. I have been reading some “watch bloggers” about the Apple Watch, and one of them suggests that to release it now makes sense, even though it does need a phone for full functionality, so that they can get the interface and UI down before making it into a stand alone product, which will take more time to develop. But by that time, they will have a rich app ecosystem already in place.

  3. Young people, think they know everything. “Apple Watch is the company’s first major product that’s basically an expensive accessory,” really? I assume they were not around for the Apple LaserWriter. How about the more recent AirPort Time Capsule – 3TB which cost more than the entry level Apple Watch.

    Young people.

  4. I don’t think Apple considers the current tethering requirement a feature. I think they see it, like the 24-hour operation thing, a limitation to be overcome as better tech becomes available.

    What makes the Watch such a departure is that this is the first product that Apple has made that is so personal, so meant to be reflective of the individual personality of the wearer. Other Apple products, in a sense, while carried by the user were only out when in use. The Watch is visible all the time and says something about how wearers see themselves.

    Also I believe the Watch is a departure because it’s the first Apple product not intended first and foremost for the US market. I believe the Watch is aimed squarely at international markets (e.g. China) where people do wear watches and not just to tell time.

    1. I’d be interesting to see where this technology stands in 10 years. Just look at the original iPod compared to an iPhone 6. Who could have imagined having a device that small with 128GB’s of storage, not to mention the graphics performance, and speeds of the CPU, GPU, SSD, bus speed, etc. In ten years, I’d guess the AppleWatch would be a standalone device with the ability to do everything the current watch does tethered to an iPhone, and probably much more.

      So my guess is, at some point only one or the other will be necessary but with a lot of people still using an iPhone and AppleWatch combo. That big screen still comes in very handy. So yes, there will be some cannibilizing, but I don’t think it’ll be very significant.

      I currently have the iPhone 6 w/64GB Storage. I don’t need one, but I want one, and will be adding the new AppleWatch to my very small jewelry collection. Can’t wait!

  5. In a very weird way, the Watch is cannibalizing other Apple products for me. Because of the Watch, I decided to get the iPhone 6 Plus, which I’ve found makes the iPad mini less useful in my line up (I still have a full sized iPad). Likewise, I’ve had various iPods for use when I didn’t want to carry my iPhone, but now the Watch eliminates the need for them.

  6. this is kinda stupid – by default, apple watch will add quarterly revenue equal to the mac computer unit.

    the Apple Watch extends the ecosystem and the watch will allow you to take calls when the phone is across the room.

    As the iPhone replaces more and more peoples’ computers, will it be so surprising to see peripherals for the iPhone?

    Which would you buy the Apple Watch or Beats Headphones for $349… or both?

      1. Apple should make Beats headphone covers and hand them out to the NFL players.

        They should also give Apple stickers to Steve Ballmer’s poor team so they can upgrade the Windows tablets he is forcing on them.

  7. I have a very thin Longines watch with a black crocodile band, so its very light. I bought it quite a few years ago and wore it all the time until one day I didn’t. That was several years ago. It still works, still looks good, is still just as thin and light as ever – but I don’t wear it: It began to annoy me and I noticed I was always taking it off.

    The Apple watch is mega bulky by comparison. Maybe if it offers some incredibly useful tech I could wear it – but not until it slims down by 75% or more.

  8. “If it succeeds, Apple Watch will become the company’s fourth major new product category since the turn of the millennium — …” whether it succeeds or not it will still become the company’s fourth major new project category since the turn of the millennium.
    Sheesh! Does he get paid by the word?

  9. It is a radical shift, but not for this reason.

    Think back to the announcement of the original iMac. It was as if you had stepped into a science fiction movie. Each time the iMac received a new chassis, it was science fiction time again.

    iPhone announcement? Science fiction. iPad? Science fiction. Mac Pro? Science fiction.

    There is nothing science fiction-y about the Apple Watch. It has been deliberately designed to look as much like your grandfather’s watch as possible. Don’t take my word for it: read the reviews by the watch snobs, I beg your pardon “horologists”. They absolutely love it.

    Some of the concept drawings we saw two months ago were far more daring than what was unveiled recently. So, no more science fiction from Apple. From here on in, we design stuff your grandfather would have recognised.

    This may be a good thing. Perhaps Ive and Cook have their finger on the pulse of consumer society. Perhaps this is what people want.

    But I, for one, am going to miss the science fiction.

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