The more that I look at the Apple Watch, the more I realise that it is not another runaway hit as the iPhone was. Tim Cook's wearable is following a similar pattern of adoption and understanding as the iPad. That promises a long and healthy life as a secondary product range, but not one that can create the sort of wealth that the iPhone fostered.
The first generation of the Apple Watch is at the tail end of its life as Apple's flagship wearable. The faithful who are going to go out and buy it on the strength of it being an Apple product will already have it on their wrists. Those who were wavering may have been tempted by the recent price cut. That's probably the extent of the easy-to-reach sales.
This week's research note from KGI Securities analyst Ming-Chi-Kuo suggests that Apple sold 10.6 million units during 2015, and that level of sales should not be discredited. To sell ten million of any product is an achievement, and there are smartphone manufacturers that can't generate that level of sales across their entire product range, let alone a single peripheral that requires a parent device to be purchased independently.
Kuo's analysis highlights September as the launch date of the Apple Watch 2 alongside the presumptively titled iPhone 7 - given the synergy between the watch and the smartphone that makes a lot of sense from a marketing and positioning perspective. Even with the launch of a second-generation Apple Watch, the 2016 sales estimate is a smaller 7.5 million units in total - a thirty percent drop on the 2015 sales.
The slowdown in sales this year, and the slower projected adoption of the next smartwatch suggests that the product profile of the Apple Watch is more in keeping with the iPad than the iPhone.
The basic features of the Apple Watch (and arguably of any smartwatch) are to deal with notifications from connected accounts, offer quick access to short bursts of information, and to tell the time. Although the Apple Watch 2 is expected to have improved hardware, built-in wi-fi for standalone connectivity, and a FaceTime video camera, that's not going to change the basic functionality of the Watch. Putting aside the hungry geekerati, that package does not offer a compelling reason to upgrade from a perfectly serviceable first-generation Apple Watch.
Much like users of the first Apple iPad discovered, the marginal gain in the next iteration of the hardware is not enough to eclipse the functionality of the original. A single Apple Watch is going to have a much longer life cycle than the iPhone. It's likely going to match the iPad in terms of hardware turnover and importance to Apple's bottom line - a notable contribution but not a driving force.
And that's fine. Not every piece of hardware can be a home run over the green monster. It's just as important to grind out a win by getting on-base as often as possible.
As it approaches its one year anniversary, the Apple Watch is not Tim Cook's revolutionary product, it's not a genre defining slice of hardware, and it's not going to cause any massive spike in Apple's gross revenue. But it joins the iPad as another solid, dependable, and reliable device that generates predictable ongoing sales throughout the year.
