Time will tell if Apple Watch is game changer

SAN FRANCISCO — No one can argue that Apple has changed the way people live. Its iPod, iTunes, iPhone and iPad have shaken up music, phone and computer markets worldwide. Will the Apple Watch do the same?

The stakes are big for the firm’s CEO Tim Cook: The watch is Apple’s first new product to be launched without co-founder Steve Jobs. But the market is awash with smartwatches that have gained little traction. Here are reasons Apple’s version will finally move the needle in the smartwatch industry and reasons it may not.

WHY IT WILL CHANGE THE GAME

More features than rivals’: Apple says its watch will, along with email, texts and phone calls, present news, health readings and other notifications in creative ways that make them readable at a glance. It will have a heart-rate monitor and accelerometer, as well as an internal motor that can signal the wearer with a subtle “tap” on the wrist. Siri and Apple Pay will also be built in. The mobile giant is working with outside firms to create more apps — Mr Cook has talked about using the watch as an electronic “key” for hotel doors or even cars.

A powerful brand: Apple has a reputation for quality and being a direct conduit to customers — it operates more than 400 retail stores around the world. It also has deep pockets to spend on advertising — it is showcasing the watch this month with a sleek insert in Vogue and other fashion magazines.

Strong track record: This would not be the first Apple product to revolutionise a market where rivals have struggled to break through. Other companies made digital music players before the iPod, smartphones before the iPhone and even tablets before the iPad. Most of those products failed to catch on until Apple made devices so appealing, they set new standards and created new demand, said Forrester Research analyst JP Gownder.

WHY IT MAY NOT

What’s the need?: Most smartwatches, including Apple’s, work only with a smartphone nearby, so you cannot swap one expensive gadget for the other. “What we’ve seen is that it’s not obvious why people would want a smartwatch,” said Mr Gownder. A recent Forrester survey found that some respondents did not see a reason to buy one as they already owned a less expensive fitness band or full-featured smartphone, but it also found Apple fans ready to buy the new watch.

Consumers not excited: You can buy smartwatches made by tech giants such as Samsung, Sony or LG, or from tech start-ups such as Pebble, that track your heart rate, show email and deliver other online services. None of them have really caught on. Only about five million smartwatches were sold worldwide last year, said market researchers at Strategy Analytics. In comparison, Apple sold 74.6 million iPhones in only the last quarter.

Price and obsolescence: Many of today’s smartwatches sell for US$200 (S$275) or less. Apple plans to sell three models, starting at US$349, but Piper Jaffray’s Gene Munster predicts the average buyer will pay US$550 for a watch and extra interchangeable bands. Apple’s high-fashion Edition model, made with 18-karat gold, is expected to cost thousands. While affluent consumers may pay that amount for a watch they can wear for years, it is a lot of money for something that can become outdated if Apple releases a new model every year or so — as it does with smartphones.

Mr Cook will make his case for the Apple Watch at a press event today (early tomorrow morning, Singapore time), when he is expected to show off more features and apps. Expectations are high. However, even the iPhone did not become a mainstream blockbuster in its first year, noted Creative Strategies analyst Ben Bajarin. Of the Apple Watch, he said: “People need to understand more about what this product is and what it does, and I think that will evolve over time.” AP