By most counts, Apple’s Watch owns the nascent smartwatch segment, but still it has problems, easily identified by Larry Dignan:
Apple’s take on the Apple Watch was to grow slow, build an ecosystem and ultimately become the next big product cycle for the company. However, Apple’s two traditional approaches–premium pricing and once-a-year hardware updates–aren’t likely to fly in the long term.
Apple has never said Watch would be an annual iPhone-like hardware upgrade cycle. The Mac is not. The iPad is not. Apple TV is not. Why should anyone buy a new Watch every year? Most people do not buy a new iPhone every year. Products have a life cycle and that ranges from a year to five or six years.
FitBit shares were whacked because it is taking on Apple directly with a smartwatch. But Samsung is also making Gear 2 compatible with iOS. And there are a bevy of specific use devices for fitness for folks that can’t see buying a smartwatch. Meanwhile, all dumb watches are going to become smart enough to compete with the so-called notification happy smart ones. Even Casio is in on the Apple Watch killing. The main takeaway here is that no one is scared of Apple anymore.
Why are they copying Apple Watch?
Apple Watch isn’t likely to be the next killer product line for the company any time soon. Apple’s smartwatch will be a success in its own right, but it’s unclear the category will be a broader hit. If that reality plays out, Apple will need to go fishing elsewhere. The iPhone can’t pay the bills forever.
How should we define killer product line? Is the Mac a killer product line? Or, is that only reserved for iPhone? If Watch sells more than a Mac does that make it a killer product? If it dominates an industry segment, is that enough to be a killer product?
What’s interesting here is the perspective. Or, lack of. Everything Apple does is wildly profitable; from Mac to iTunes to Apple Stores to iPhone to iPad to Apple TV to App Stores. Everything. But it’s fact that most of Apple’s revenue and profits come from iPhone and that’s not likely to change any time soon. Something has to be the company’s biggest seller.