Only 2-4% iPhone users interested in Apple iWatch: Report
Apple has yet to confirm an iWatch but analysts are already saying millions of consumers are willing to adopt the smartwatch.
Randell Suba | On 08, Oct 2013
Apple filed a patent for a touchscreen wristband in several countries, but it has yet to confirm that it will be launching an Apple iWatch to join the frenzy on wearable technologies. While the iWatch remains to be a rumor, analysts have already forecasted that the iPhone and iPad manufacturer might sell 10 million of the said smartwatch in its first year of release.
A recent poll by Gene Munster of the investment firm Piper Jaffray revealed that about two to four percent of iPhone users in the United States are most likely to use an iWatch if such gadget will be released by Apple. The survey conducted by the senior analyst inquired about the interest and willingness of consumers to buy an iWatch with a sticker price of $350. Twelve percent of the respondents said that they might buy an iWatch while the rest of the respondents said; they will pass on the wearable technology.
Earlier speculations predict that Apple will launch a smartwatch by 2014 featuring a two-inch touchscreen. The alleged iWatch will most likely have features that will help consumers monitor their health, serving as a heart rate monitor, pedometer, among other biometric functions.
“While we do not view the watch as a likely needle-mover for Apple in terms of revenue in 2014, we put it in a similar category as the television in that it could demonstrate Apple’s ability to innovate (good for the multiple) and potentially lead to a more meaningful new product category in wearable tech,” Munster said in an interview with Apple Insider.
“If you assume that Apple sells 7.5 million units in the first year (midpoint of our 5-10 million unit range) at an ASP of $350 and a 30 percent gross margin, it would increase our 2014 revenue estimates by $2.6 billion or 1 percent and gross profit dollars by $790 million or 1 percent,” he added.
Apple will sell up to 10 million iWatches in the first year.
The survey takes note of the buying power of consumers in the U.S. compared to the international market, so Munster puts a leash on the possible adoption rate to be conservative. At the predicted price tag with a 30 percent margin, the iWatch can rake in an additional $2.6 billion gross income and a profit of $790 million for Apple.
Back in February and August, surveys by Morgan Stanley and the CIMB Group, respectively, projected a lower price tag and a better market penetration for the iWatch. Morgan Stanley predicts that Apple might sell the smartwatch in the range of $100 to $300 and deliver 50 to 150 million units in its first year. CIMB Group, meanwhile, forecasts the iWatch price to be between $150 and $230 and sales over 63 million units next year.