A Deeper Analysis of the Apple Watch

Being a early reviewer of the Apple Watch, I posted a public piece on my perspective of the product. I wrote it for a general audience since I believe there will be a lot of interest in the Apple Watch. For you Tech.pinions subscribers, who appreciate deeper analysis, I want to tease out some expanded observations.

First, there will be some debate as to “Apple Watch vs. the smartwatch market”. However, from what I know already and see coming in the pipeline, I still do not believe there is a smartwatch category. There is an Apple Watch category, but not a smartwatch category. This is similar to the early days of the iPad where it was common to say there wasn’t a tablet market but only an iPad market. I believe this same dynamic will be true of the foreseeable future for the Apple Watch.

But whether or not there is a smartwatch market is of no concern to Apple or those in their ecosystem. Apple’s customer base is different than every other base out there. I have articulated this frequently. The Apple Watch will succeed or fail based on Apple’s customer base and no other. The smartwatch category doesn’t have this luxury. Google has multiple ecosystems and low and high end customers to try and cater to. The Apple Watch sets itself apart because of the tight hardware, software, and services ecosystem. Google’s Android OEM landscape will make a run at creating an ecosystem but I’m skeptical it will be competitive in the near future.

Apple’s customer base is also largely comprised of the most profitable customers on the planet — those with higher disposable income. This alone gives the Apple Watch a huge advantage. Most existing high end watch owners already have an iPhone. Many of the existing owners of health and fitness bands have iPhones. Apple’s tight integration will be a huge differentiator.

I’m also fond of saying Apple is blessed by their developers. As I mentioned in my public post on the Apple Watch, what makes this product work is Apple reimagined the software for seconds of interaction — not minutes or hours. This required an entirely new approach to software. Developers will similarly have to evolve how they think about their software. Some early apps I’ve tried are not accomplishing this. Some of the apps available for the Apple Watch are not reimagined software for micro-exeriences. While some are, this is a critical new interaction method developers need to embrace and develop for.

I believe Apple developers will adapt and capitalize on this new interaction model. This will give Apple another huge ecosystem advantage from a software standpoint in ways they have done in other areas like the iPad.

Force Touch is another thing I spoke of. This has a huge upside in Apple’s ecosystem in my view. There is something remarkable that happens in your brain when you use force touch on the Apple Watch. You feel feedback in your finger and it gives you the sense there is more behind what you are doing. When this comes to the iPhone and the iPad, it is going to be another huge differentiator, particularly when software developers take advantage of it and embrace this new UI and gesture element. Force Touch may be one of the more revolutionary interfaces Apple has brought to market.

The behavioral shift I mentioned in my article today certainly caused me to think a bit more about the role a smart screen on your wrist will play. Un-tethering from the phone in many of the ways the phone un-tethered us from our PCs is the best way to understand this product. The iPhone, like the PC, plays a key role. Arguably in this analogy, the iPhone is still more critical than the PC for most people. However, the freedom to know you still have access to relevant and useful information or notifications at a glance certainly has a somewhat liberating effect. But, as I said, the Apple Watch excels at quick interactions and, in many ways, does them better than the iPhone. This is because most software on the iPhone is designed for more engaged interactions than for quick ones. Building an entire platform around interactions measured in seconds rather than minutes or hours is where the Apple Watch sets itself apart and settles into its own as a usage model.

The Apple Watch has huge upside for the Apple ecosystem. This is the key way to think about Apple products. They are designed with their ecosystem and their customers in mind. The Apple Watch adds an interaction model to the Apple ecosystem that didn’t exist before. The Apple Watch fills a gap, one that will have appeal to many millions in the Apple ecosystem. It may not be a product that is a necessity, but it is absolutely a complimentary and value added product to Apple’s ecosystem. It opens the door to new experiences and new interactions. Anytime that happens, it is good for consumers and good for the industry.

I’ve been using the Apple Watch for a week and still discovering new and useful things it does. I’ll keep diving deep for subscribers as I explore more of the possibilities of the Apple Watch.

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Ben Bajarin

Ben Bajarin is a Principal Analyst and the head of primary research at Creative Strategies, Inc - An industry analysis, market intelligence and research firm located in Silicon Valley. His primary focus is consumer technology and market trend research and he is responsible for studying over 30 countries. Full Bio

19 thoughts on “A Deeper Analysis of the Apple Watch”

  1. Great analysis, as always, Ben.

    I think we need to stop thinking about the relative sales of the Apple Watch, iPhone, iPad and Mac and start thinking about the total sales of the iOS ecosystem. Everything Apple has done over the past two years or so has been designed to strenghten that ecosystem. Even seemingly peripheral items like Apple Pay and the upcoming Beats music service are designed to make the Apple iOS ecosystem ever more valuable to its existing and future customers.

    My major concern with the Apple Watch was whether it’s operating system focused on operations that were best served by a wrist worn computing device. Based on the many reviews I’ve read -including yours, Ben – it appears that Apple nailed it. Assuming Apple has made the watch useful, the watch simply becomes one more reason why Apple customers will never want to consider leaving the Apple ecosystem.

    Microsoft made Windows indispensable to businesses and consumers that wanted to connect to their business computers by making Windows compatible with every computing device. Apple, on the other hand is creating a separate user interface for their watch, their phone/tablet and their notebook/desktop machines while still incorporating them under one ecosystem umbrella. Microsoft’s mantra could have been one operating system to rule them all. Apple’s mantra, on the other hand, might better be stated as one ecosystem to rule all Apple – and only Apple – devices.

    Without a doubt, we live in interesting times.

    1. You’re right. Unfortunately it’s a binary choice. You’re in or your out. Binary choices, generally, are more limited than non-binary choices. I wonder if Android Wear will come to iOS. I wonder if it would be allowed. I wonder the same for the Apple watch pairing with my Android or WP.

      If I’m going to be “herded” I will choose the corral with the widest gates… 😉

      1. Every choice is binary. This reality cannot be avoided. It’s more accurate to say that every choice is singular. You could have a choice between ten options, but since you are human you can only do one thing. You could choose three of the ten options, but you can’t engage in those choices simultaneously. You cannot go out for supper at a pizza joint while going out for supper at a steak house at the same time. You can do one and then the other, but not both simultaneously.

        You could easily choose to use both Apple and Android in various aspects of your life, but money quickly becomes the limiting factor, so you make a choice. Either choice produces limitations as well as value, which differs from person to person. But there’s no difference in the choice itself.

        As you say “choose the corral with the widest gates”, but it is still a gate.

        1. Not quite true. A device is typically a two year commitment if it’s a phone (and likely a watch), For those two years, I can eat at an East Coast Diner with it’s vast menu’s and daily specials (with full condiments on the table), or a highly specialized bistro with the same well prepared but limited menu. I can choose both, but that would require a two year commitment to both, so I pay twice.

          As far as gates, in 2015, even the earth has gates…

          1. As I said, every choice produces limitations as well as value. Now you’re simply arguing about one choice being better than another choice. Choose what is best for you of course, but your choice is still just a choice. What you find limiting others find freeing, and vice versa.

          2. No. The diner example offers an “ecosystem” with much more choice after the primary choice is made.

          3. That’s only true for you. It isn’t true for me. You’re attempting to argue that your choice is better. For you, it is. For me it is not. I view your ‘more choices’ as a limitation, a negative. You frame it as ‘more choice’ to make it seem objectively better. It is not. You make a choice. I make a choice. That’s where it ends. Both are perfectly valid choices, one is not objectively better or ‘more’. For me the Apple choice is ‘more’. But that is only true for me.

          4. That was to show that not all choices are binary, as you said. The menu, in either case, is multiple choice. One broader than the other.

          5. Your choice is only broader for you. The same choice is more limiting for me. I realize you cannot accept that, but it is true whether you accept it or not. And every choice is actually singular, one after another, each imposing different limitations in different ways. I suppose you could buy two or three Android phones, all from different OEMS, and use them one at a time for different uses, but then you’re back to the paying twice or three times scenario that you wanted to avoid.

          6. Now you’re just being argumentative. Ever hear of multiple choice? That’s what a menu is. Which, among 538 things, would you like to eat? There are 538 things to choose from, not either/or. And you can choose multiple things as well.

          7. You can only choose one thing at a time. Of course we could discuss groupings, but even within a group it is one thing at a time.

            The larger point is your claim about one choice being broader than another choice is false. Your choice is broader for you, but it is more limiting for me.

          8. You’ve offered no reason to ever choose the “highly specialized bistro with the same well prepared but limited menu.” You set the choice as “vast” vs “limited”, as if no other dimensions exist. So it isn’t much of a choice.

            If you had said the bistro had a better prepared menu, or specialized menu choices not available among the vastness at the East Coast Diner, then that would be a real choice.

          9. I spoke about my choosing the corral with the widest gates. I also brought up the two year commitment as a financial limiter of choice.
            Now to your question. If I could not have pancakes with horseradish sauce and marshmallow soup for two years, as well as a steak, I personally would choose the diner over the exquisite restaurant that will give me foie gras each and every day.

      2. “Unfortunately it’s a binary choice. You’re in or your out.”

        I take your point, but it’s not quite true. There are, for example, apparently a lot of people who own both Android phones and Apple iPads. Apple sets up their products to be most useful for those who buy within their ecosystem but people can, and do, mix and match.

        I often compare Apple to Disneyworld and Android to the boardwalks at the beach. There are far fewer Disneyworlds, they’re more expensive but the experience is superior because Disney controls every aspect of the amusement park. On the other hand, Boardwalks are far more prevalent, far cheaper and provide a much more diverse experience.

        To me, the beauty of capitalism is that you can pick or choose the services or products you like. It’s good to live in a world that has both Disneyworld and boardwalks and it’s good to live in a world that has both Apple and Android.

        1. But John do you really think Klahanas really believes in Capitalism or free market. What I’ve observed after reading some of his gems here he doesn’t. He often DEMANDS that Apple must give same options as other competitors are giving. So in reality he wants Apple to be same like others. Since you’re a very well read person surely you’d have known that it only happens in Communism, where every one should be same. And surely he doesn’t believe in free market. Because in free market for a transaction to happen you need two mutually agreeing parties but he doesn’t want to give any choice to one party(which in this case is Apple) to come up with something they want to manufacture and sell. Quite a hypocrisy.

  2. I realize you are providing an analysis of the Watch as a product category, but you never mentioned the feel of the watch or the performance. Nilay Patel had a lot of negative comments about these areas. Of course, Apple will improve the software in later releases, but the performance of the processor is fixed.

    The size and heft of the device is obviously fixed until the next version. I was a bit dismayed when I realized the watch is thicker than my iPhone 6!

    I do think the slightly lighter Sport Watch will be the largest seller because of the cost for version 1. There are a lot of us that will drop $400 on it just to see what’s useful and see how it integrates into our lives.

    1. I think Nilay and I had very different experiences. I did notice some app lag, but only with third party apps as they had to go fetch / sync data. That will get resolved with software.

      I personally like the feel and found it significantly more comfortable than I expected. I own other thick watches so that was not an issue but I rarely wear a watch all day. This was the first / most comfortable wearable I’ve used. Milanese loop was my band and very comfortable.

  3. People seem to be setting this up as phone vs. watch, whereas at least for the foreseeable future, Apple has settled on the phone being the hub, and the watch is an accessory.

    In the early iPhone days of 2007-2009, Mac was the digital hub (in Apple’s universe), and iPhone was dependent on the Mac/PC for apps, media, updates, backups, etc. If I traveled (commuted), I had to take both, but Mac could stay in my bag for major portions of my trip. iPhone could handle many tasks well and some arguably “better” than Mac because it was more convenient (quicker, less awkward) even if the Mac had a cellular card. But I would still plan certain times and places to do all the things that were better done on a Mac.

    Now iPhone is the hub for Watch. If I travel, I take both, but iPhone could stay in my pocket for major portions of my trip. The devices are smaller, so it’s easier to take both now, and it’s easier to pull out iPhone than Mac. The question is how many tasks can Watch handle “better” than iPhone because it is more convenient? Some fitness monitoring is better. Some comm is better (quicker, more intimate) but long texts/email responses would be worse. Apple Pay is better, and I’d guess other IoT interactions would be as well. Giving directions via tapping is better when you’re listening to music or talking to other people. What are others?

  4. The Apple Watch is going to be judged right now based on its usefulness in conjunction with the iPhone and its UI but I think longer term the Disney Magic Band analogy is going to be more interesting. The one thing that the watch gives over the phone is that it is more likely to be tied to your person. If people wear it as intended, it gives the power to accurately identify you reliably. Trying to think about what this means is difficult because the infrastructure is nascent or completely absent currently but it is coming. And I suspect it will be here faster than everyone anticipates.

    Two major pieces of technology related to the IOT that I found this week are signs that the infrastructure depends more on standards, business models and deployment than technology:


    The technology is ready. These miniature systems are already capable of being deployed cheaply with short range networking. Add in the already burgeoning iBeacon market and the market for a wearable terminal that allows constant contact with the various CPUs and sensors nearby becomes possible. I just can’t get my head around how they are going to be used but I’m convinced we are only a couple of years away from a new revolution. Something like the Apple Watch allows for a ubiquitous interface for these devices.

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