Blog - Eternal vs. ephemeral

11/11/2014 Eternal vs. Ephemeral [updated] | Transformation Hydraulics

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Transformation Hydraulics

THOUGHTS ON BUSINESS STRATEGY, AND HOW TO MAKE ITWORK. BY NICOLAS SCHOBINGER.

[Update: Changing iWatch to 'Apple Watch'.Thanks @chrisbintliff, @AeroEchelon, aaronbrager, and others formaking me aware that potslaunch 'iWatch' was not the right term touse anymore.]

The Apple Watch starting price for its brand Sport version will be about$349 – and will pose a direct threat of disrupting Swiss and Asianbrands in this price segment.There will be also a massive gold upscale variation being called theApple Watch Edition. While official pricing has not yet been announced,estimations vary widely from $1,200, $4,999, or up to $9,999 (take alook at this good summary here). The latter pricepoint seemsespecially interesting – that’s around the same pricepoints you nowfrom luxury brands like Omega, Tag Heuer, maybe even Rolex.

So, from Apple to Swiss, pricing may be comparable. But can youreally compare the actual products?

Eternal vs. Ephemeral [updated] 5

Sep

24



For instance, the Swiss watch industry, according to LVMH’s JeanMarc

Biver, positions itself as selling “eternity in a box”. Theirs are heirloom

pieces that can last and function forever. The technical halflife of an

Apple Watch is going to be a few years at best. Add to this the fashion

effect, which may shorten its lifespan even more. Unlike its eternal

Swiss counterparts, Apple seems to be embracing the “ephemeral”.

Eternal vs. Ephemeral. Are (or even can) these two concepts actuallybe in competition against each other?

How often does one need to buy an ‘eternal’ product? How often would

you buy ‘ephemeral’? Look at iPod, iPhone, and even computers in

general. Technology advancements and rapid innovation cycles make

you lust for the newest gadget. And that’s just it: Ephemeral product

lures customers to the next best thing.

I can easily image, that Apple could extract a higher lifetimecustomer value with its Apple Watch Edition, than the ‘eternal’brands of Swiss watchmaking.

I could imagine that the Apple Watch Edition will generate a lot ofrepeat buyers. A good tradein program would recycle your preciousmetal and refund that to you. You could keep the straps. The price for

your repeat purchase could be then a fraction of your initial buy. You

could constantly renew your statement with the Edition line and staycurrent. Ephemeral disrupting Eternal.

Indeed, I think the whole Apple Watch affair is going to ripple out

much broader than from what was initially unveiled September 9.

Swiss watchmakers, eyes wide open, have let it get this far, largely

undisturbed and unchecked. Let’s watch how this unfolds.

Copyright 2014 Nicolas Schobinger. All Rights Reserved.

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5 THOUGHTS ON “ETERNAL VS. EPHEMERAL [UPDATED]”

Posted in Smart Watches, Transformation

Tagged Apple Watch, swiss made

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dr.oop— SEPTEMBER 28, 2014 AT 04:05 Edit

All Apple needs to do is 10 year warranty.I believe that is what watch manufacturer also offer the same.Which just means a battery change in 5 years in case of Watch.S1 is not going to change every year.S1 can only change if all the support chips move to lower voltage orchip processing node. That doesn’t happen often.S1 is not going to get powerful unless new battery tech is alsointroduced.

Apple may tinker with straps or shapes and colors every year just forthe fashionbut the heart doesn’t change.

If the Watch can sell in 20 million range every then chipmanufactuers will shrink their chips. Just remember chip tech is at 20nm right now. can get to 16 nm in two years but all the support chipsare probably in 45 nm or higher. Unless Apple pays for this privilegethat won’t change unless economics dictate it.

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Anonymous— SEPTEMBER 29, 2014 AT 23:02 Edit

I think you’re wrong on the chip front. I think the S1 will veryeasily become the S2 in a year or so, and move to an annualbasis very quickly. Apple is thinking about more than just aWatch here. I would be surprised if they don’t have severaldevices in the pipeline that use the S1, or something like it.

Anonymous— SEPTEMBER 27, 2014 AT 21:33 Edit

It’s Apple ‘Watch’ not ‘iWatch’.

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aaronbrager— SEPTEMBER 27, 2014 AT 21:19 Edit

I agree with your assessment – there will be some type of trade inprogram (whether or not Apple runs it).

Btw, it’s called “Apple Watch” not “Apple iWatch”.

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