Apple to charge thousands of dollars for premium Watch timepieces

Apple’s computers, smartphones and tablets are often considered too expensive when compared to similar devices from other manufacturers. In the world of technology, specifications, software and some other factors determine the “fair” price. With its forthcoming Watch timepieces Apple is going to enter a new market of luxury devices, where price is determined by materials and the quality of crafting. As a result, premium Apple Watches will cost thousands of dollars.

When Apple announced its Watch product line last week it only revealed pricing for the entry-level Watch Sport models that will be made of anodized aluminum and will be sold for $349. The company did not say a word about pricing of its more advanced Watch models made of 316L stainless steel as well as Watch Edition models crafted of 18-karat gold. While the inner hardware of all three collections will be similar, the materials they are made of (as well as their bracelets) will determine actual price.

John Gruber, a well-known tech blogger who is believed to have good sources at Apple, speculated this week that instead of entering the emerging market of smart-watches, Apple simply entered the well-developed market of watches. The latter is very broad and includes loads of various price-points. Instead of competing against Asustek or Samsung, in the $200 – $500 category, Apple intends to address the market of watches in general with three collections: Watch Sport, Watch and Watch Edition. While the most affordable Watch Sport will be available for $349 per unit, the more advanced stainless steel Watch are expected to cost starting from $999 or even more, whereas the 18-karat gold Watch Edition are projected to cost $4999 and higher, depending on the bracelets.

According to Apple, it takes nine hours to make one 316L stainless steel bracelet, which consists of over a hundred of components, for the Apple Watch. The bracelet alone should be rather expensive. For example, a replacement stainless steel Rolex bracelet can easily cost $2500 or more. Therefore, the entry level model in the Apple Watch collection could easily cost a lot more than $999. Of course, Apple will also offer models with leather straps in the Watch collection, hence, the $999 price-point could still be met.

Apple did not reveal almost anything about the Watch Edition collection, except the fact that the wristwatches will be made of solid 18-karat gold. Typically, a case and a bracelet of a watch could weigh around 100 – 150 grams. The current spot price of gold is $1223 per ounce, or $43.14 per gram. Therefore, the material alone for Apple Watch Edition with golden strap should cost $4314 – $6471. Since gold requires crafting by hands, it is easy to expect Apple Watch Edition to cost well-over $8000 if the case and the bracelet are heavy. Even if the case alone weighs around 25 grams, it means that it will still cost $1078 only for gold, therefore, even with a leather bracelet Watch Edition will still cost well over $2000.

Unlike Apple’s current products, iPhone, iPad, Mac, etc., Apple’s Watch is not a technology, but a lifestyle product. One would prefer something sporty for $349, another would prefer something tremendously luxurious and stylish for $5000 – $10,000, or even more in case of custom-made exclusive timepieces.

Quite naturally, Apple’s own retail stores will not carry ultra-expensive Apple Watch products. It is highly likely that Apple will sell them at traditional watch stores.

Apple did not comment on the news-story.

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KitGuru Says: In case the assumptions are correct, with its Watch timepieces Apple has managed to do something no tech company has ever done: to enter the market of luxurious gadgets under its own brand-name. No matter how good the iPhone smartphones are, they still represent the “one size fits all approach”. By contrast, there are three distinctive Apple Watch collections that will be sold at different price-points. With tens of different watch models, Apple will clearly be able to rival Swiss watch-makers since it will be able to offer something for everyone. What will be interesting to see is how ofter Apple plans to update its Watch products. Luxurious timepieces stay on the market for years or even decades. With electronic watches such situation is impossible.

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