APPLE WATCH: A NEW CATEGORY FOR APPLE
On initial impression, some might say this seems like less of a watch and more an iPhone nano. While the iPhone 6 is an evolutionary change and larger than before, as I discussed in my last article here, the Apple Watch is a new product category for Apple with new ecosystems to go with it. I talk about the ecosystems here.
This is the dawn of a new platform for Apple, and though it’s clearly a “1.0” product shipping in early 2015, they got a lot right their first time out. Especially in functionality, this has more raw compute power and storage than any “wearable” I’ve seen. The software and controls are astounding. At two different sizes, 35mm and 44mm, there is a tension between too small that you can’t use the face, and too large to fit on the wrist. The Taptic Engine is another feedback and output system: you feel different kinds of vibrations for notifications, left and right directions, etc. Apple provides the buyer a choice. Indeed, lots of choices: two different sizes, three different case materials or “collections” each in two different finishes, and a spectrum of different straps. Think of the permutations! Apple will create product segmentation and customization from the beginning.
Horologically, Apple is returning to a market it previously unintentionally de-popularized: the wristwatch. Wristwatches had replaced the older pocket watches especially during the late 19th century for military applications, but the popularity of the Apple iPhone meant people were checking the time from the device in their pocket.
With a return to the wrist, will consumers respond, and is this the “wearable” that they will adopt? Tim Cook said that this is Apple’s most personal device and indeed it is. Unlike an iPhone or iPad, you’ll wear this device on your body. With this many colors and finishes people can obsess over the details. It can become not just a fashion accessory but a piece of intimate information jewelry. Could it become the “digital hub” of information devices a person uses? Sure it will be able to turn on an off various devices, sync with iDevices and Macs. But this will be something that touches our skin. How many people will want that kind of symbiotic relationship with the Internet? People already feel comfortable with an Internet-connected smartphone. The Apple Watch must be more than a sophisticated time piece. The iPod was a non-Internet “always-with-you” device that replaced carrying around a computer to access your entire library of music. The iPhone became that always-with-you device and replaced the iPod. The Apple Watch must consider competing with the iPhone.
Mobile devices carried for connectivity have been around since early cell phones. But computing/communication devices you don’t carry but wear is a horse of a different color.
Google is making a foray into this space with Google Glass, but is not gaining much traction outside the early adopter gadget tribe. Worn on the face, with an asymmetrical appearance and the sneaking suspicion that the “viewee” is being recorded — it seems too overt. It comes between people, it brings up questions of privacy. And initial reaction has included prohibiting them in shower rooms. They are banned in casinos, the White House, Pentagon, and Congressional galleries. Watches are less conspicuous.
A variety of portable and wearable Bluetooth-enabled fitness sensors have become increasingly popular of late. The Jawbone Up and the FitBit are market leaders. Nike had pioneered this space with its iPod Sensor, placed in a Nike shoe in a special space under the footpad, or worn outside a shoe. Apple bundled a Nike app in early iPods and iPhones to display the activity.
Each of these devices are long on data collection, but poor to non-existent on display. They relied on an iPhone or Android phone to display the metrics collected.
Nike has a FuelBand which is a wrist device with a dot-matrix display. Heck, Apple CEO Tim Cooke, and long time Nike board member, used to wear one. It was reported this year that Nike had discontinued the Fuel Band and laid off the staff, preferring to work on FuelBand software rather than hardware, but Nike has stated that they will continue to develop and market the Nike+ FuelBand SE.
I’ve worn smartwatches for over 30 years, since the Casio Calculator and Data Bank watches. However, it’s a bit of a stretch to call these smartwatches. While they had great functionality, they screamed “nerd alert.” In recent years, smartwatches include those from i’m Watch, MetaWatch, Motorolla, ConnecteDevice, Martian, Microsoft and others running Google Android Wear. Sony, LG, Martian, and especially Samsung lead in this market.
But the real standout has been Pebble. Two years ago I was an early supporter of their Kickstarter project which raised over $10M, far beyond their initial ask. I currently wear their second generation device, the Pebble Steel, an advance on their original all-plastic device. I find it useful to see my next calendar appointment, the weather forecast, message and appointment alerts, and check-ins on Foursquare/Swarm. With the latest firmware update and their 3D accelerometer, monitor my step activity and sleep duration. It is more than simply a “monitor” of my iPhone, though its standalone functionality without connecting via Bluetooth to the iPhone is limited.
What are the Implications?
- Android Wear devices could enjoy an opportunity to move in a less crowded market as there’s a shakeout of other platforms, mentioned below.
- Pebble, especially the Pebble Steel was priced at $249, just $100 less than an Apple Watch. However, since the Apple launch, Pebble dropped the prices on September 29 to $219 and $99 respectively. Pebble’s entry level plastic version priced at $99 could continue to sell, though it is “black and white” compared to Apple’s color display. Nevertheless, the Pebble has an always-on, multi-day battery and is water resistant.
- Jawbone Up and FitBit. These devices are useful sensors with limited displays, except when paired with a smartphone and computer. While they won’t be able to go upmarket, they may survive if they work with Apple and Android devices in a complementary way — due to their long battery life, lower price, and smaller form factor. FitBit, however, has announced that they will not support Apple’s HealthKit ecosystem. Current users are already complaining.
What’s My Take?
I think Apple has a huge hit on their hand with Apple Watch. We have been told about the hardware, but little about the software and what it does. I think that’s intentional on Apple’s part: they need to work out some kinks on battery life (1 day?) before they launch. But the software could go in unexpected “category busting” directions.
Initially the Apple Watch will be tethered via Bluetooth to the iPhone for its connection to the Internet and for some co-processing duties. And for more robust display and input. But I don’t think that’s Apple’s end game. I believe Apple intends to make this a standalone device. It will take some time to build an Apple Watch app ecosystem and enhancements to the UI and input capabilities. It comes with 4GB of storage, the same as the original 2007 iPhone. Today’s limiting factor is battery technology: once there are sufficient advances I’m confident it will be cellular-connected. What if you didn’t have to carry your iPhone, or your wallet?
The big unknown is the health and fitness capabilities. We know there are 4 Sapphire glass lenses that cover visible and infrared LED sensors on the back of the Watch. We know some of the things they monitor, but not all. What if you could let your physician monitor your pulse and exercise activity? Some companies already reward employees with healthcare dividends who allow their FitBit stream to be read by their health provider. But what if the Watch was capable of monitoring blood pressure that might signal an impending heart attack, or blood glucose levels for diabetic alerts? I’ll discuss this more in my next article.
Though it’s priced at a premium — $349 for the entry-level Sport Collection — I believe this will be a popular gift option. With a price range that starts at half that of a non-subsidized iPhone up to an 18-karat gold device that I believe will go for thousands of dollars, this will be a fashion statement that says status and prestige. The iPhone is more difficult to award as a gift, as you need to know the cellular plan for the recipient. Initial Apple Watches, like iPads, don’t need to worry about that. iPads are frequently given away as a prize. The Apple Watch will be a premium gift.
Watch designer and SVP of Design at Apple Sir Jony Ive said during the Apple Watch video introduction:
…this is technology that “embraces individuality and inspires desire.”
Lust-worthy fashion statement or a powerful yet proximate tool?
Thanks for coming along.