We finally have a release date for one of the worst kept secrets in the history of consumer electronics. Apple has confirmed that the Apple Watch will hit the stores on April 24, and analysts are already predicting that it will be a significant catalyst for the smartwatch market in general.
2014 was a stellar year for the world's most significant consumer electronics company. Apple notched two massive achievements during the calendar year, with the corporation becoming the first to ever achieve a market capitalisation value in excess of $700 billion. Analysts already believe that the Apple corporation will exceed a $1 trillion market cap in the near future.
Meanwhile, the fourth-quarter of 2014 was a particularly significant one for Apple. During this three month period, Apple produced the biggest recorded single-quarter profit in business history.
In addition to these to massive achievements, the market analysis firm Gartner recently reported that Apple is now selling more mobile devices in sheer volume that Samsung, its major rival. Apple has been more profitable than Samsung for quite some time, but the Korean manufacturer has always been extremely popular in its native East Asia. But with Apple gaining increasingly mark penetration in China, and companies such as Huawei and Lenovo producing quality, affordable mobile devices perfect for marketplaces in developing economies, Samsung has seen its dominance of this region somewhat decline.
The World’s Top Brand
It is in this context that the release of the Apple Watch must be viewed. Apple has already been ranked by the authoritative Interbrand survey in 2014 as being the world's most prestigious and recognisable brand. To top the 2014 survey was a massive achievement for the consumer electronics corporation; to put this into perspective, Coca-Cola had topped the Interbrand report consecutively for the last 15 years.
But the California-based corporation currently has an almost untouchable position at the head of consumer electronics. It is this strength that almost ensures that the Apple Watch will be a massive success. In accordance with this, analysts are already suggesting that Apple will shift 20 million Apple Watch units by the end of 2014. This would be ten times the number of smartwatches sold by Samsung with its Galaxy Gear range.
It must be said in mitigation that this is a particularly optimistic estimate, and news seeping out of the Apple supply chain about the number of devices being produced by corporation suggest that Apple doesn't necessarily expect to sell 20 million this year. But it is hard to see any other outcome than the Apple Watch massively outselling previous smartwatches, and if this is the case it will almost certainly escalate the process of smartwatches becoming a mainstream technology.
Apple has certainly tried to cover every base in terms of the models of the Apple Watch that it has produced. Initially, the Apple Watch will ship in three separate versions, although there are numerous strap and face options available for consumers who decide that they wish to purchase one. But this situation probably won't continue for too long; Apple Insider is reporting that new Apple Watch models with different casing materials are expected to launch this fall.
So the Apple Watch, the Apple Watch Sport and the Apple Watch Edition may be the initial models of this smartwatch, but they are soon to be joined by other options. However, in the meantime it is interesting to note the strategy that Apple has adopted with this product release.
Each of the three models is clearly intended to attract a different raft of consumers. The Apple Edition is by far the most expensive mainstream smartwatch to hit the market thus far, and is very much intended to be a luxury item aimed at high-end consumers. This is an intriguing move by Apple, as the luxury watch market is already crowded with extremely well established and renowned brands such as Rolex and Cartier.
At between $10,000 and $17,000 per unit, the Apple Watch addition is certainly out the price range of many consumers, so it will be interesting to see whether the more well-heeled Apple fan is tempted to shell out for this pricy wearable.
The other two Apple Watch models are much more competitively priced, with the Apple Sport model obviously based around its health-tracking functionality. But the most significant aspect of this smartwatch series for the travel industry is strongly emphasised with the standard Apple Watch model. Among its many functions is the ability to make mobile payments via the Apple Pay system.
With the mobile payments market expected to increase rapidly in the remainder of this decade, Apple is clearly seeking its slice of the pie. Apple Pay has already gained significant traction in the United States, having been launched with six major card-issuing banks and three major networks as partners: American Express, Mastercard and Visa. According to Apple CEO Tim Cook, 2,500 banks now support Apple Pay, as well as nearly 700,000 locations.
While Apple has been to some extent criticised for the degree to which the Apple Watch requires an iPhone in attendance in order to function properly, this does not apply to mobile payments. After it is pre-configured, the Apple Watch can be used anywhere Apple Pay is supported.
Mobile Payment War
Already numerous major manufacturers and companies are lining up to compete for this lucrative market. The Digital Tourism Think Tank reported recently on the launch of Samsung Pay, which will be compatible with Samsung’s Galaxy range of devices. Mobile payments will be another major front in the ongoing war between these two consumer electronics giants. Additionally, recent media reports have indicated that Microsoft might be planning a smartwatch in the near future.
The potential of such technology to impact upon the travel industry is obvious, but Apple has clearly already thought ahead in this department. During the Spring Forward event which unveiled this smartwatch, Apple gave considerable credence to both American Airlines and easyJet; both of which will be supporting the Apple Watch in its embryonic stages.
European economy airline easyJet in fact intends to launch its Apple Watch app on the day of release. The app will provide personalised flight notifications in real-time, as well as easy access to boarding passes.
The Digital Tourism Think Tank has previously reported on how applications related to medical AI could help cement wearable technology as a viable commercial product. While numerous travel companies are already experimenting with wearable technology as they attempt to innovate and offer an improved customer experience.
The release of the Apple Watch looks likely to stimulate a technology niche that will have serious ramifications for the tourism industry in the very foreseeable future.
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