Apple's iWatch Could Be Super Profitable

Business Insider ^ | 03/04/2013 | Jay Yarow

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Apple's iWatch, which is reportedly coming this year, could kill three birds with one stone for Apple.

1. It gives Apple an experimental entry in the wearable computing market which is said to be the next big thing

2. If done well it would kill the Apple-can't-innovate-without-Steve Jobs meme

3. It could be super profitable.

Let's tackle the third one. Bloomberg, citing a Citigroup report, says the global watch industry will do $60 billion in sales this year, with average gross margins of 60 percent.

Apple's iWatch, should it be released, will probably not fit neatly into the watch industry, so these comparisons are probably moot. (The margins on a $54,000 Audemars Piguet watch are probably pretty high, but unrelated to a mini-computer on your wrist.)

However, that doesn't mean we can't take a shot at trying to figure out how much money Apple could make on an iWatch.

In 2010, iSuppli estimated Apple's cost of goods plus manufacturing bill was $45.10 for an iPod Nano. The iPod Nano was the little square iPod with a touch screen. It actually wound up being used as a watch by a lot of people, and perhaps was a preview of an iWatch at Apple

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[Chuzzlewit]

small screen... I suppose it’s possible it could be huge..

thing is my phone is 12 inches away from my wrist, in my pocket.. so that saves me 1 second to get my data on my watch on a much smaller screen.. is saving 1 second worth the inconvenience of this tiny screen?

what the heck do I know, however... I’m old.

[Menehune56]

Looks intriguing but kind of thick. Always best to wait for at least the 3G model.

[kevkrom]

I don’t even like to wear a watch, period. I can’t imagine anything as bulky as these would have to be being comfortable for me, nor do I have any information needs so urgent that I can’t just reach for my phone, which is always on my person when I’m awake.

Maybe there’s a market for such a device, but I’m not part of it.

[SJSAMPLE]

Interesting, but I still want Tom Cruise's watch from "Minority Report".

[oldbrowser]

How long before they come up with the transporter function?

[longtermmemmory]

this was done before.

this must be vaporware.

[Quick Shot]

It is very interesting what the cell phone industry has done to the watch industry for the under 30 market. It almost does not exist. We have our phones, we know what time it is. The advantage of this is could eliminate separate phone.

[wbill]

I dunno, it would be convenient to have a computer / phone / do-it-all gadget that I could carry around on my wrist. Especially if it used a wireless interface for mouse, monitor, and keyboard....Imagine just being able to sit down at a "workstation" and start working. That would be pretty cool.

But, would I drop $500 bucks on it? Unlikely. I'd file this under "Cool toys for people who have more money than sense".

[Sawdring]

1. It gives Apple an experimental entry in the wearable computing market which is said to be the next big thing

Could give a new meaning to the IPad.

[longtermmemmory]

watches are fashion not function.

see rolex

see any swatch.

see fossil

see cartier

IF this is rea, it is a “chick magnet” as much as a calculator watch...

[SeekAndFind]

Now, if the iWatch has a Dick Tracy like built-in phone, the next question would be this -— WILL IT BE ILLEGAL TO TALK ON THAT PHONE WHILE DRIVING? (It is in many states).

[SeekAndFind]

Imagine being able to control things in your office or home remotely from your watch... What’s not to like?

[martin_fierro]

OK, you have my attention.

[Uncle Miltie]

[kevkrom]

With sufficient reliability and bandwidth for wireless connectivity, this likely would be the end-game for such devices. Eventually, you have a single device that acts more like a “key” than anything else, although it would essentially double as a local I/O terminal (microphone/speakers, camera/screen) as well. You’d need little local storage space if everything were accessible on demand from “the cloud”.

If you need a real screen & keyboard combo, the desktop terminal you sit in front of uses your settings and data fed from your “key”. The TV set knows what videos you’ve bought or uploaded by accessing your “key” info; likewise the home or car stereo can access your music and audiobooks. And so on.

To a large extent, this can already be done with (using Apple’s ecosystem since that’s the article subject, but there are other similar - if slightly less integrated - approaches) iCloud and iTunes and compatible devices (Mac, iOS, and Win7 or later), though cloud storage capacity and reliable connectivity for mobile devices are limiting factors. Also, they still only tie existing multiple “accounts” together, that is, my PC profile and my iPhone are two distinct “accounts” for me, although they are linked by iCloud.

What we’re looking at here may be the actualization of the old Sun Microsystems slogan: the network IS the computer, but the technology isn’t there, not yet at any rate, and not affordable enough for widespread adoption.

[Cold Case Posse Supporter]

But are they waterproof?

[lacrew]

Hmmm...

Most young people don’t wear watches - their cell phone is their watch.

Most young people like to use two hands on their phones, for texting.

Cell phones have actually gotten bigger in recent years - the advantage of a useable screen being more important than micro-size.

I’m not sold.