Tim Bajarin: Apple is about to change the watch industry forever; luxury watchmakers won’t be able to keep up

“Apple has already disrupted the computer, phone and music industries — and now it’s poised to change the watch industry forever, too,” Tim Bajarin writes for TIME Magazine.

“When Apple introduced the Apple Watch last fall, I started asking people in the high-end watch world if they viewed the device as a threat. Surprisingly, many told me that the Apple Watch could very well redefine what a ‘watch’ is and does,” Bajarin writes. “The Apple Watch won’t force high-end watchmakers to change course entirely, as the jewelry aspect of their business will always have appeal and lasting value. But talking to those in the watch world gave me a real sense that the Apple Watch is a game-changer.”

“When digital watches flooded the scene, they were easily copied, explaining why the 1980s-era transition from analog to digital happened so fast,” Bajarin writes. “But Apple’s approach — they own the hardware, software and services — will be nearly impossible for watchmakers to replicate. Devices like the TAG Heuer/Google watch that run Android Wear will continue to try to compete, but from what I’ve seen from Apple, the Cupertino giant could have an edge for at least a year or two, if not more.”

Read more in the full article here.

MacDailyNews Take: As long as Apple continues to operate properly — and as evidenced in smartphones and tablets by 64-bit mobile processors, Touch ID, Apple Pay, Handoff, and many other ecosystem advantages — Android Wear will never to be able to compete with Apple Watch. Apple does things right and Android struggles to follow, at a great distance (64-bit, hello?) or half-assed (flaky fingerprint recognition, contactless payment systems that nobody uses, etc.).

Even those who initially settled for the pretend iPhones offered by Android can now clearly see that Fragamndroidland is a backwards land; for followers, not leaders; a place of frustration and insecurity; an afterthought for developers; a wannabe, not the real thing; off-the-shelf processors running an off-the-rack mobile OS in hardware with inferior build-quality; a hodgepodge of devices and skinned OS versions that will never work together as seamlessly as Apple products; a kitchen with too many cooks; and, ultimately, a dead end.

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19 Comments

  1. Making a Luxury Android Phone & Watch?

    Android OS is synonymous with fragmentation, malware, and 2nd rate apps. How is using Android OS going to project an image of excellence on a luxury SmartWatch?

    If a luxury watchmaker wants to compete with Apple iPhone + watch experience they’ll have to design their own ecosystem. It will need to include a SmartPhone and App Store as well as a SmartWatch.

    Hire programmers: They’ll have to start with the latest stable (???) version of Android OS for phone and watch. (Android will allow use and modification of its code, eg, Amazon and its Fire tablets.) Modify the OS to close security holes, increase stability, and modify OS to only accept apps, patches and updates for OS and apps from its site.

    Hire programmers tasked with maintaining comparability with the latest Android OS developments, security updates, and patches. At some point doing so may become untenable and a new fork will be created, and become independent of the main Android OS.

    Hire web designers for website and App Store.

    Developers must submit all apps to the App Store for testing and approval, and only approved apps can be loaded on watch and phone from its website.

    Hardware for the phone shouldn’t be a problem, just find an existing Android manufacturer to build to your specifications, and load your phone OS on it.

    The luxury watchmaker would style, design and fabricate case and watchband.

    Hire an engineering team responsible for computer components selection and integration of the SmartWatch.

    This seems to be a rather expensive proposition, not to be taken lightly, but it would be a way of insuring a quality result. Not many will be likely to contemplate doing so.

    Duplicating the Apple experience of iPhone + watch will not be easy or cheap! I don’t think it realistic for a luxury (mechanical movement) watchmaker to have the mindset, motivation, to make the necessary financial investment involved in the production of a quality, luxury SmartWatch. 😀

    1. Ask Samdung how its going trying to create their own mobile OS and compete…….not.

      Bottom line is they are all chasing Apple and the problem is they really have no way to compete except to go with the free stolen option (Android) and sell their soles to the devil. They know it suck but what else they going to do?

      Buy more AAPL.

    2. Steve said that the original iPhone was five years ahead of the compete. But you know what, it’s been eight years and no company has come close to the iPhone. I believe the same hard work Apple put into the iPhone will cause competitors fits for the next decade plus.

  2. I think those who say that there will always be a market for traditional high end watches are being very short sighted. It may take a generation or longer before it becomes apparent (though I doubt it will be that long). Think about what today’s kids are going to want to strap on their wrists when they become teens and young adults. A computer, or a mechanical time piece? And at what point in their lives are they going to say I’m going to replace this device that does everything with a traditional watch, because during my parents’ life it was a sign of status. I just don’t see it happening.

  3. > the Cupertino giant could have an edge for at least a year or two, if not more.

    Try “more,” a lot more (like forever). Any watchmaker (like TAG Heuer) who creates a smart watch must make it as compatible as possible (to maximize the audience and potential sales). The watch must work with widest possible range of Android phones, and even be “compatible” with iPhone because TAG Heuer’s target customers use iPhone. That forces limited interaction between watch and phone. And the watch needs to be sellable for its limited stand-alone functionality.

    In contrast, Apple intentionally limits the audience for Apple Watch to iPhone owners. Apple could go after Android phone owners and maximize Apple Watch’s potential sales, but Apple does not. Apple Watch only needs to work with iPhone and iOS, which Apple controls completely. Therefore, the interaction between Apple Watch and iPhone is integral and complex. What Apple Watch can do is NOT limited (because Apple Watch’s “brain” is iPhone), and Apple’s corps of developers will prove it.

    During Year One of Apple Watch, iPhone sells Apple Watch; iPhone’s customer base is in the hundreds of millions, so only a small fraction needs to buy Apple Watch for it to be a HUGE success. Over time, Apple Watch also sells iPhone; iPhone customers with an Apple Watch want their next phone to keep working with their Apple Watch. New customers who want Apple Watch buy iPhone as their next phone, instead of Android.

    1. Imagine in say 5 years, when the Apple Watch sales are in the hundreds of millions. The installed base reaches half a billion in less than 10 years. There will be no room left for luxury Android phones at this point and they are relegated to the “cheapy phone” category. There won’t be any more high-profile high-profit Android handsets, all will be low-end junky or barely above junky level.

  4. Going for marketshare or a monopoly ultimately results in a damaged or an unexciting brand. General Motors, Toyota, Microsoft Windows, Google Android, …

    1. The firms you gave as examples have done nothing to take their respective products to the next level via innovation. None have dominant marketshare, ergo none are monopolies.

      Microsoft comes closest, but its strength is in the enterprise. iOS is on far, far more devices than is Windows iOS is an exceptional alternative to Windows for everything except content creation (and with the exception of Excel, those weaknesses are beginning to blur).

  5. ken1w has it right. The Apple Watch will lock in current iPhone 6/6 Plus users, drive upgrades from older iPhones, and increase the rate of Android to iPhone conversions (with a multiplying effect coming from Android users buying Apple Watch). Calendar 2016 is going to be a serious AAPL investment year (investors are buying now, ahead of the rush), followed by an unbelievable 2017.

  6. “The Apple Watch won’t force high-end watchmakers to change course entirely, as the jewelry aspect of their business will always have appeal and lasting value.”

    I’m not so sure. I have a feeling that will dry up as people switch to the Apple Watch as a functional everyday device.

    How many people buy high-end pocket watches?
    Almost none. A very few are worth a lot, the rest are sitting in drawers or available cheap on eBay.

    How many people collect rare horse-drawn coaches?
    Almost none. People collect cars now.

    I believe stamp collecting will eventually fade away too, when no one has any personal connection to the category anymore. People spend crazy amounts of money on things they love. People will forget all about wristwatches they way they forgot about pocket watches and carriages.

  7. The opinions expressed by MDN are not necessarily those of the Apple user community. I’m an Apple fanboy. But I don’t resort to kicking Apple competitors when they’re down or attempting to compete. I don’t care what competition does. I only care what Apple does. Apple thinks the same. Shame MDN.

  8. Not all watchmakers are trying to keep up with Apple. Apple Watch is fundamentally a computer strapped to hour wrist with a lot of multitasking and functions. Quality timepieces are not in the same market space. There’s a difference. I for one have no problem reaching for my iPhone 6 Plus and will not be needing an Apple Watch, at least not the first generation.

  9. Considering how long they have been making mechanical watches I don’t see this latest development changing anything fundamental when it comes to the market for luxury mechanical watches.

  10. The iPhone already disrupted the watch industry. The Apple Watch will just bring back the people who left.
    The next generation of people will still wonder why some people put stuff on their wrists that only tell time.

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