Seriously? Are there any number at all to show that wearables are a growth bet at this point? The Apple Watch (which entered the market three years ago!) has had an uptake at least an order of magnitude lower than the iPad, the last "next technological innovation" that turned out not to be. Tablets were hot for a while, but at the end of the day the smartphone market remains an order of magnitude bigger. The watch has never remotely been that hot.
Basically: innovation is hard. Wearables are not looking like the next big thing at this stage, and they are surely not going to save Apple from the expected downturn in smartphone sales.
If it's not better than the most successful consumer product in human history, it's not worth bothering with? Apple is now the most profitable watch company in the world, they sell twice as many iPads as laptops, and sell more of them than even the biggest selling laptop company sells laptops, and their ASP is still going up.
Sure. Failed products. What's the point of even trying.
> expected downturn in smartphone sales.
Which may be a problem some day, but while sals are flat-ish, even their Phone ASPs are still going up. So while growth may not be as rapid as in the past, they'll just have to console themselves by showering in firehoses of cash flow instead.
"But the most interesting stuff came when Cook referred to the success of Apple Watch. The Watch sales are part of the wearables business which also includes headphones such as Beats and AirPods.
Last May, he said that business is approaching the size of a Fortune 500 company. More recently, last month, the size had crept up so it would fall in the top 400"
https://www.forbes.com/sites/davidphelan/2018/02/15/apple-ce...
Its impressive how many people buy the Apple Watch without understanding what it offers.
https://www.nbcnewyork.com/news/local/Smart-Watch-Saves-New-...
IF wearables is going to be much of a thing I wouldn't expect to see their flagship products come out until everyone else has had some time to work out the kinks with early adopters. Then watch Apple come in with some of the sticky problems solved (like touch on the smartphone, fit/finish with laptops, simpler OS, etc...).
Apple is so big that it needs a huge new market to enter to make a difference in its revenue. Healthcare and transportation are huge markets. Apple is working on both.
- reading
- responding emails
- GPS
I don't think I'm market fit for smartwatch and wearables.
I also don't see any success in AI self-driving, where alphabet is King.
* Bass Diffusion Model: https://en.wikipedia.org/wiki/Bass_diffusion_model
* Diffusion of Innovation Model: https://en.wikipedia.org/wiki/Diffusion_of_innovations
These models have been fairly accurate in forecasting diffusion of innovation. While many of the innovators have started to exit and move on, this leaves the imitators around in a slowing market.
Apple has been surprisingly good at being the forefront of innovation entering a market. While people play catch up in smartphones, Apple has already moved onto the next technological innovation: Apple Watch and wearables.
While one may argue that Apple is more of an imitator than innovator, they have a really unique strategy. They enter a market after the initial innovators have entered with a product that becomes the Dominant Design [1]. They don't focus on the Innovator or Early Adopter market, but more on the Early Majority and Late Majority and exit before the laggards arrive. The Innovator and Early Adopter market require the most capital in R&D and Marketing with lowest return on investment.
[1] https://en.wikipedia.org/wiki/Dominant_design