The much-discussed Apple Watch will be available at retail this month, with prices starting at $349. So what does the release of the latest and most discussed smartwatch mean for the luxury watch industry in Switzerland?
The Apple Watch — Apple’s first entirely new product line since the iPad and the first since the death of Apple’s visionary founder Steve Jobs — is already widely expected to become the market leader among smartwatches (Click here for info on some of its predecessors/competitors) based solely on Apple’s history. It runs apps, including a fitness tracker, and unlike previous smartwatches, includes a very analog-watch-like device — a “digital crown” on the side that can control the watch’s functions. We cover the details and functions of the Apple Watch here.
The biggest question, both for the aficionados who collect luxury watches and the people who design, build and sell them, is obvious: Does the rise of the smartwatch, and the game-changing Apple Watch in particular, lead to the sequel that no one wanted, namely “Quartz Crisis II?” The Swiss mechanical watch faced off with a similar high-tech competitor in the 1970s and 1980s, when watches equipped with the then-new, Japanese-made quartz movements threatened to render traditional mechanical watchmaking obsolete. The industry managed to recover from those harsh years when the luxury mechanical watch (most still made in Switzerland, but also thriving in Germany and even, to an extent, in Japan) began to be rediscovered as a luxury item and status symbol in the booming 1990s. But any watch-industry veteran who experienced that era will tell you that there was a lot of pain in those intervening years. Will the watch-buying public once again turn away from the traditional and embrace the new high-tech flavor of the month?
It’s always hazardous to try to predict the future, especially in a business as unpredictable as watches. But I tend to agree with Swatch Group CEO Nick Hayek, who, despite his own company’s recent foray into smartwatches with the Swatch brand, anticipates problems with constant software upgrades and needing to replace the watch often. (Click here to hear the man himself speak on the subject.) I also echo the thoughts of our Watch Insider, Alexander Linz, who opines in a recent blog post: “We are talking about two totally different segments, and also a different buyer. It could be that someone who is used to wearing a mechanical watch will now also wear a digital smartwatch, but it will never replace the mechanical timepiece on his wrist. On the contrary, I believe that Apple and all the other producers of smart watches will probably stimulate people who have ever before worn a watch to buy one now, and I could imagine that these people might later start buying other watches, with some of them eventually buying a mechanical watch.”
In short, I believe that high-end mechanical watches have cemented their status as coveted luxury items for a worldwide audience, one that is still growing. No one “needs” an expensive watch, but no one “needs” a Lamborghini Gallardo or a Jackson Pollock original or a bottle of Chateau Lafitte Rothschild 1945 either. An iPhone is expensive, but no one can convincingly argue that it can be considered a luxury item for most people at this point. If smartwatches were ever to totally supplant traditional mechanical watches, I believe it would be a sign of something much more momentous: a large-scale abandonment of the luxurious and the artisanal in favor of the mass-market and the utilitarian. And somehow that is difficult to imagine.