Apple Watch Edition's top-end price tag of $17,000 could help legitimize wearables and lead to more smartwatch sales for all manufacturers. Source: Apple
For Apple (AAPL +0.11%) fans, this is an exciting time. The rumor mill is in overdrive regarding new features for the next iPhone iteration: the iPhone 6s. Early reports focus on the inclusion of Force Technology, a RAM upgrade, and a carrier-agnostic SIM card. Meanwhile, the company's Mac line is in high gear with MacBook Air and Pro refreshes now available and the new MacBook line shipping on April 10.
Even with all that, fans at the moment are focused on the Apple Watch. As an entirely new product -- Apple's first since the Steve Jobs era -- the watch is a major unknown. Will it catch on and propel the company to new highs like the iPad did during its rollout, will it merely be a complementary item like Apple TV, or will it fall somewhere in between?
If a new article from TechCrunch is any indication, Apple Watch may be a huge success -- but its benefits could stretch across the industry, including archnemesis Samsung (NASDAQOTH: SSNLF).
Pebble's CEO is happy about Apple Watch's event
Outside of Apple, the biggest winner from its Apple Watch launch event had to be smartwatch maker Pebble Technology. During the event, Pebble poked fun on Twitter regarding what it considered a few drawbacks of the product, including its lack of waterproof design and the top-end price tag of $17,000 -- all the while drawing constant comparisons between its watch and Apple's device, essentially benefiting from free marketing.
It worked; the company's Kickstarter campaign designed to fund its new watch picked up steam due to Apple's announcement. According to Pebble founder and CEO Eric Migicovsky, Apple's media event led to a doubling of the amount contributed to its Kickstarter campaign. (TechCrunch calculated that it actually tripled.) Migicovsky noted:
Apple's event this week caused a nice spike in support for us, as anticipated. When the biggest company in the world enters your market, that's the kind of validation you can only dream of. Ultimately the more awareness for smartwatches, and the more choice for consumers, the better for everyone. 2015 is going to be an extraordinarily exciting year.
Kickstarter funding doesn't equal product sales on a dollar-for-dollar basis -- people can donate to Pebble solely for the purpose of supporting the company and in any amount they wish. That said, Pebble's Kickstarter campaign is a good proxy for increased unit sales because backers of $159 or more are entitled to a new Pebble smartwatch.
Pebble was No. 2 in smartwatches sold in 2014; guess who was No. 1?
If the Apple Watch launch had such a big impact on Pebble, what about last year's smartwatch market leader, Samsung? According to research firm the Smartwatch Group, Samsung sold 1.2 million smartwatches last year while Pebble sold 700 million. The following chart from Statista gives detail on the market by unit sales:
You will find more statistics at Statista.
Samsung focuses on a different end user than does Apple: Android users. Samsung has struggled against Apple recently in the high-end smartphone market, due to the launch of the iPhone 6 and iPhone 6 Plus. But there is still a big base of high-end Samsung phone users. Samsung could see an appreciable bump of Android Wear sales as Galaxy owners seek to compete with Apple owners for the next cool gadget. The best part for Samsung is that this newfound legitimacy is totally free.
In the end, Apple's entrance into smartwatches appears to be creating a halo effect for the entire industry, essentially validating the product in the eyes of many new prospective buyers, as Pebble's CEO said. Interest in smartwatches goes beyond the limited number of people with the iPhone 5 and newer models. As a result, Pebble, Samsung, and all smartwatch manufacturers should welcome Apple's entrance, not fear it.
