So Apple’s Watch is finally coming

After climbing as high as $103 during Apple’s Cupertino event yesterday evening, the shares finished marginally down at $97 following the announcement of new iPhone’s (the 6 and 6 Plus) with larger screens and thinner and the eagerly awaited Watch. The company also announced its new payment system, Apple Pay, which allows automated transactions to be made using the iPhone without the physical presence of a credit card.

There was disappointment that the Apple Watch was pricey at $349, had to be used with a iPhone 5 or 6 and was not due for launch until next year. Some were surprised how “cool” the new device looked but some questioned how the “health and fitness” device would fit into users lives and how good the battery life would be. The Watch features an innovative new user interface to allow the wearer to access apps and the device was described by the company as ‘It’s something functional yet incredibly beautiful’. Apple has announced the product now so that developers can begin designing bespoke applications.

Apple created a new category with iPhone and iPad, many are questioning whether the Apple Watch will do the same for the wearable accessory sector given it does not seem a step change in technology versus current offers in the fitness space such as Fitbit. After so much anticipation for the new device there was bound to be an element of disappointment since there is only so much you can innovate with a watch. Apple’s shares have had a great run in 2014, with the reality of forthcoming product launches now clear will the market now take a less optimistic view of future prospects.

Creating another fantastic piece of technology like the iPad and iPhone isn’t easy and shareholders need to get used to more stepwise enhancements rather than breakthroughs. Tim Cook has plenty to do to deliver the innovation of the Jobs era and so far many Apple consumer have been a little underwhelmed as competitors such as Samsung continue to push the company. But in the meantime, The Apple Watch certainly looks like a very desirable product. How many will desire it enough to part with quite a lot of cash will be the big question mark. With the power of the Apple brand it seems unlikely that the product will be failure especially if the developer community get behind it just like they did with the iphone. The App store now has over 1.3 million applications on offer.

Contrarian Investor UK

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