Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



1 Peculiar Reason Why Apple, Inc.'s iWatch May Not Be Real -- Yet

A strange thing has happened to Apple (NASDAQ: AAPL  ) over the past few years. While Apple's obsession with secrecy is well documented, its ever-expanding global supply chain has made it increasingly difficult to keep secrets, especially those related to hardware.

After all, it's pretty difficult to mass-produce tens of millions of devices without any pieces leaking, especially when the entire world wants to know what you're up to. That's why almost all details about new iPhones are known months in advance, and industry watchers are hardly ever surprised at iPhone unveilings anymore. The only types of things that Apple is usually able to keep secret are intangible aspects like names and pricing. Physical hardware is very hard for the company to keep under wraps.

Consider the iPhone 6. In recent months, dozens of prototypes and casings have leaked, likely as unscrupulous factory workers sneak iPhone pieces out hoping for 15 minutes of fame. This one is just the latest in a long string of sneak peeks at what to expect.

With all of that in mind, combined with the widespread expectation that Apple will launch the iWatch this year, why haven't there been any iWatch hardware leaks of any kind?

Possible explanation 1: Apple has succeeded in doubling down on secrecy
The more you try to hide, the more people want to know what you're hiding. Apple is frustrated with its own rumor mill, which leads it to become even more obsessive about secrecy.

To some extent, Apple has come to terms with the effects that its rumor mill has on its financial results. During earnings conference calls, the company frequently notes that speculation regarding possible upcoming products tends to cause purchasing delays, particularly during quarters immediately before an expected launch. The good news is that those are usually just delays, and Apple typically isn't losing those sales to a competitor.

All the same, Tim Cook vowed in 2012 that Apple would "double down on secrecy on products." That hasn't seemed to stop the current stream of iPhone 6 leaks, or to a lesser extent iPad Air 2 leaks. But perhaps Apple has been able to sufficiently insulate the iWatch supply chain, preventing prototypes and casings from seeing the light of day.

Possible explanation 2: The iWatch is delayed
Another possibility is that the iWatch isn't launching this year, and that mass production has not commenced. If Apple is a little earlier in the development process then people have been expecting, there may not be as many possible points of leakage within the supply chain.

Backing up this theory is a report from KGI Securities analyst Ming-Chi Kuo, who has a fairly good track record regarding Apple rumors. Kuo believes that Apple has run into manufacturing challenges with the iWatch, and as a result it will be delayed until 2015.

While Tim Cook has promised investors that Apple will enter new product categories in 2014, and agrees with services chief Eddy Cue that this year's product pipeline is the strongest in 25 years, there could be factors outside of Cook's control such as manufacturing challenges.

Possible explanation 3: There is no iWatch
This is the most unlikely scenario, but what if there is no iWatch? Or rather, what if the iWatch isn't actually seeing a launch anytime soon? Recall that shortly after Steve Jobs' death, everyone was widely expecting an Apple TV set to launch based on comments Jobs made to biographer Walter Isaacson.

Yet, here we are almost 3 years later and no Apple TV set has materialized. Apple appears content to push its TV and living room strategy with the current set-top box offering, which is actually probably the right call anyway. The TV business is not attractive, and Apple can accomplish its ecosystem strategies with the current device.

Regardless, it's possible that any iWatch currently in development may not meet Apple's high bar for its products, and perhaps the company isn't planning on releasing the device anytime soon, if at all.

Again, this explanation is the least likely, as Tim Cook is a purported fitness buff and the wearables trend is too important for Apple to sit on the sidelines. 

Leaked: Apple's next smart device (warning, it may shock you)
Apple recently recruited a secret-development "dream team" to guarantee its newest smart device was kept hidden from the public for as long as possible. But the secret is out, and some early viewers are claiming its everyday impact could trump the iPod, iPhone, and the iPad. In fact, ABI Research predicts 485 million of this type of device will be sold per year. But one small company makes Apple's gadget possible. And its stock price has nearly unlimited room to run for early in-the-know investors. To be one of them, and see Apple's newest smart gizmo, just click here!

Read/Post Comments (5) | Recommend This Article (10)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On August 26, 2014, at 12:16 AM, canucknobuck wrote:

    Could be a feint. Get your competitors working on something and keep them distracted while you focus on refining your product line and extending the ecosystem with HealthKit and HomeKit. In the meantime they watch and learn from the smart tvs and smart watches that have been rushed to market and then, based on those lessons release a product that defines the category. Apple isn't always first to market. There were music players before iPod. There were tablets before iPad. But when they go, they go big.

  • Report this Comment On August 26, 2014, at 5:34 AM, kent1960 wrote:


  • Report this Comment On August 26, 2014, at 6:26 AM, Mathman6577 wrote:

    No.3: I believe Tim Cook alluded to the iWatch in a recent interview:

    No. 2: Just like the iPhone6 "rumors" that is is late how can a product be "delayed" when it hasn't even been announced?

    No. 1: Why don't we all wait until Apple actually comes out with a product instead of speculating? There is plenty of other things to write about.

  • Report this Comment On August 26, 2014, at 3:02 PM, KombatKarl wrote:

    It's real. It won't be announced at the iPhone event so as not to take the spotlight away from their cash cow. Expect an iWatch announcement later in the fall sometime.

  • Report this Comment On August 26, 2014, at 7:52 PM, jellybelly wrote:

    The original iPhone had to be approved by the FCC, a process that takes several months and whose filings are publicly accessible. Apple had to control the presentation of the iPhone and it's features that would be publicly available in the filing. Therefore it was announced 5 to 6 months before it was approved (and possibly tweaked) and released. With medical/health sensors and ability to hook to third party sensors and software, an iWatch device would need approval of the FDA. I suspect that will drive Apple to announce some months before the availability. Upside is the buzz and free publicity around the device, and the downside is features known to competitors ahead of release. This product is unique similar to the original iPhone in this aspect.

    I'd expect it to have it's own announcement, after the initial month or so of buzz and excitement of the new iPhone starts to lose it's peak.

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 3077739, ~/Articles/ArticleHandler.aspx, 8/29/2015 7:32:44 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Evan Niu

Evan is a Senior Technology Specialist at The Motley Fool. He was previously a Senior Trading Specialist at a major discount broker. Evan graduated from the University of Texas at Austin, and is a CFA charterholder.

Today's Market

updated 22 hours ago Sponsored by:
DOW 16,643.01 -11.76 -0.07%
S&P 500 1,988.87 1.21 0.06%
NASD 4,828.33 15.62 0.32%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

8/28/2015 4:00 PM
AAPL $113.29 Up +0.37 +0.33%
Apple CAPS Rating: ****