iWatch Frenzy Hits as Apple Falls Below Gundlach Target
Citing people familiar with Apple's plans, Bloomberg reported the Apple-branded watch could arrive in 2013. According to the report, Apple has filed at least 79 patent applications which have the word wrist in it, including one for two-way communication of location data between a portable media device and an accessory. This patent allows media to be transferred between devices using GPS data with a separate accessory.
The iWatch could run on Apple's iOS mobile operating system. It could be a scaled down version of the operating system, according to the report, and limit the amount of information sent to the watch.
Apple couldn't be immediately reached for comment for this story.
There have been recent attempts at smart watches, most notably Nike's (NKE) SportWatch. Bloomberg noted that Apple's lead designer Jony Ive has been interested in watches for some time, and even ordered boxes of Nike's sports watch in the last decade, according to Scott Wilson, who used to be Nike's creative director, and is now a watch designer.
There have recently been concerns that innovation is slowing down at Apple. The consumer tech giant's latest announcements have largely been refreshes to existing products, such as the iMac, MacBook Pro, iPhone and iPad. The only new product Apple announced recently is the iPad mini , but that's just a smaller version of the iPad.
The Cupertino, Calif.-based firm now generates the majority of its revenue from the iPhone, which is slowing year over year, but is still a growth story. Last quarter Apple sold 47.8 million iPhones, up from 37.04 million in the year-ago quarter. That amounted to 37.1% year-over-year growth, not counting the extra week in the fiscal first quarter of 2012 because of the leap year. Apple's earnings estimates were recently cut by Credit Suisse , citing a slowdown in iPhone units, due in large part to a mid-2013 iPhone refresh.
An iWatch could prove to be big business for Apple, and alleviate some of the revenue and growth concerns the company has had in recent months. Morgan Stanley analyst Katy Huberty previously wrote in research notes that an Apple smart watch would have advantages over others currently on the market. It would not only lessen the innovation worries, but it could prove to be big business as well. Huberty believes the watch could be worth as much as $10 billion to $15 billion in annual revenue for Apple, assuming a $200 price point.