With Apple’s announcement of pricing details and a ship date (24 April 2015) for the Apple Watch, the technology echo chamber has gone into overdrive, with predictions ranging from complete flop to mind-blowing success. The truth undoubtedly lies somewhere in the middle, since failure is almost inconceivable for a product with Apple’s design and engineering chops behind it, not to mention the company’s marketing muscle and unlimited budget. On the flip side, the Apple Watch cannot possibly match the iPhone in terms of success, not least because it requires an iPhone and offers little functionality that goes beyond what the iPhone provides.
Here’s where the Rorschach ink blot test starts — what you think about the likely success of the Apple Watch probably says quite a bit about how you view Apple. Those of us who pay close attention to Apple seldom bet against the company, since Apple has repeatedly proven its ability to identify a target market, meet that market’s needs, and continue to execute over time. But we’re also victims of selection bias, since there are an awful lot of people out there who know or care little about Apple, many of whom may have iPhones, but a majority of whom rely instead on Android smartphones.
Here’s an experiment to try. Identify several friends who aren’t involved in the tech industry in any way, explain the Apple Watch to them, and see if they think they’d be interested. I did this with a friend who’s a massage therapist and does all her work on an Android smartphone and tablet, both purchased because they were cheaper than the iPhone and iPad. She had no trouble understanding what the Apple Watch offered and even picked up on the fashion angle for some potential buyers, but was shocked at the pricing and was concerned about what would happen to it in several years.
It’s particularly interesting to see how people react to the Apple Watch’s pricing. Previously, Apple had said only that the Apple Watch would start at $349, generating vast amounts of speculation about how the more expensive models would be priced. It was all wasted brain cycles, of course, because it’s not as though you could change your behavior in any useful way based on a prediction, correct or not. Now we know that the Apple Watch Sport will cost $349 (38 mm) or $399 (42 mm), the Apple Watch will range from $549 to $1,099 depending on size and band, and the gold Apple Watch Edition will start at $10,000 and top out at $17,000.
How you view those prices is another ink blot in the Rorschach test. Personally speaking, I grew up on a small farm and for the first 10 years of my life, my parents were trying to be entirely self-sufficient. Even after they eventually settled for jobs, their income didn’t hit some definition of middle class until I was almost out of high school. In short, it’s hard for me to spend money at all, and that’s exponentially true for luxury items.
Yes, I’ll buy an Apple Watch Sport because it’s essential for our business that I know about it (and as an athlete, I want to evaluate Apple’s fitness claims), but I’d have a hard time justifying the mid-level Apple Watch, and the Apple Watch Edition is utterly unimaginable for me. If I’m going to buy something, it needs to be highly functional and improve my life in a real way. But that’s me, and clearly, lots of people spend vast sums of money on luxury items that have no practical value — they’re shopping for entirely different reasons.
Where I suspect many long time Apple customers feel discomfort is not actually in the prices, but the fact that Apple is presenting us with a purchasing decision that doesn’t hinge on quantitative specifications, and instead on intangible factors like emotion, desire, and affirmation of social status. That’s a major shift. Apple has never before presented us with a model choice that couldn’t be resolved by evaluating functionality. Spend more on a desktop Mac and you get more performance or a larger screen. Spend more on an iPhone or iPad and you get more storage or better connectivity. Increased price has always been associated with a quantitative benefit, and you can match that to your functional needs. For those of us who
instinctively avoid luxury brands, being given a choice between different Apple Watch models that are functionally identical is uncomfortable.
Plus, while Apple has changed over the years, this is the company whose first Macintosh marketing slogan was “The computer for the rest of us.” While never the cheapest, Apple’s technology has always been welcoming and inclusive, and the Macintosh was a force for the democratization of technology, breaking down hierarchies and control structures. The iPod and then the iPhone may have had an elitist cachet briefly, but quickly became so widespread that using one in public in no way made a statement about class or wealth.
With the Apple Watch, though, Apple has changed the equation. Paying more doesn’t get you a more functional Apple Watch, it gets you a more expensive Apple Watch that everyone can see on your wrist. Does the stainless steel Apple Watch really cost $200 more to make than the aluminum Apple Watch Sport? Is there really $10,000 worth of gold in the Apple Watch Edition? Of course not. Apple is setting these prices so consumers can choose how much they wish to spend and in doing so, make a statement about what sort of people they are and what socio-economic class they belong to. I wonder if I’ll ever see an Apple Watch Edition in the wild.
Regardless, the next Rorschach ink blot comes when pondering the future of the Apple Watch. The only statement from Apple on this topic is that the battery is replaceable; TechCrunch claims the battery will last around three years. The bigger question is if Apple will make upgrades to the Apple Watch available.
Those who are dubious of Apple’s commitment to current customers (as opposed to attracting new ones or generating upgrade revenue) will consider the Apple Watch a dead-end purchase that will end up in a drawer alongside that old iPod nano. It’s not like you can upgrade any other Apple device these days. Conversely, optimists who like to imagine the most efficient technological solutions will instead posit that Apple will come up with a way of swapping the guts of the Apple Watch for newer hardware. That would also protect the future value of the Apple Watch Edition for those who can’t imagine buying a $10,000 watch that may lose its functionality in a few years.
Extend that to the next generation of the Apple Watch. I think there will be one. As Jeff Carlson, author of our “Apple Watch: A Take Control Crash Course,” commented in a staff discussion, the investment in research and manufacturing infrastructure to make the Apple Watch is staggering. Even if this initial model of the Apple Watch isn’t an instant best-seller, Apple will continue to add capabilities (standalone GPS and a waterproof case, please!) and further miniaturize the components. Or at least that’s how I see things, since I’m a technology optimist — I always see better gear just around the corner. But that’s a long way to look into the future — not
everything Apple touches turns to gold, and I suspect that those who believe Apple hasn’t been the same since Steve Jobs died may see the Apple Watch as indication of how Apple is continuing to wander.
Personally, once I tamp down my discomfort with how Apple has positioned and priced the different Apple Watch models, I’m excited to get my hands on one and see how it integrates into my life. And once I do, I’ll hold out hope that becoming addicted to the Apple Watch won’t result in a $400 biennial tax and a trail of obsolete hardware, either because the initial model holds its own functionally for much longer or because Apple provides some sort of hardware upgrade to keep it sufficiently capable. But that’s just me. How about you?