Swatch Smartwatch Launch Announced by Nick Hayek

Ornatus-Mundi · 2015-02-05T07:16:19Z

Swatch Group CEO Nick Hayek announces Swatch's smartwatch launch, challenging Apple. Explore the Swiss watch industry's pivot to wearables and market impact.

Ornatus-Mundi

WPS member · Horological Meandering forum

9 replies3074 views2 photos

Ornatus-Mundi reports on Swatch Group CEO Nick Hayek's surprising pivot on smartwatches, announcing Swatch's entry into the market within months. This development, following TAG Heuer's similar move, signals a significant shift in the Swiss watch industry's stance on wearable technology and its potential competition with devices like the Apple Watch.

Bloomberg today reports that shortly after TAG-Heuer's Jean-Claude Biver also Nick Hayek, CEO of Swatch Group, changed his stance on the emerging smart watch topic and announced the launch of Swatch's own smart wearable device in just 2-3 months time from now:

"(Bloomberg) -- Swatch Group AG plans to start selling a smartwatch within the next three months, potentially pitting the Swiss maker of colorful plastic timepieces against the debut of the Apple Watch.

The device will communicate via the Internet “without having to be charged,” Chief Executive Officer Nick Hayek said in an interview. The Swatch smartwatch will also let consumers make mobile payments and work with Windows and Android software, he said.

Hayek is ready to go head-to-head with Apple Inc., which has scheduled its smartwatch introduction for April. The market for such timepieces, which enable phone or data communication, will probably reach about $10 billion in 2018, Citigroup Inc. analysts forecast last year, with half of the market coming from traditional watch wearers switching to the devices.

Swatch has decades of experience developing technology that might go into a smartwatch, such as long-lasting batteries so thin they’re bendable. The company’s Tissot brand has made watches with touch-screens since 1999 that now offer an altimeter, a compass, and sensors to record a diver’s descent.

Skeptic’s U-turn

Hayek has been skeptical about the smartwatch’s potential. Two years ago he said that he didn’t think the smartwatch would be a “revolution” for the industry. He has repeatedly voiced concerns watch screens are too small for communicating and that such devices might need too much charging. Last year, he said Swatch won’t participate in a race to be first in developing the products because of consumer resistance. He once said Swatch’s luxury brands such as Blancpain are smartwatches because “they make you look smart.”

“Entrepreneurs are practical people, and they care more about being successful than being consistent,” said Luca Solca, an analyst at Exane BNP Paribas. “Hayek has always said they have relevant technology for a smartwatch -- sensors, display, battery -- and seems to be set to make the most if it. Better to have an option and a hand in this category than not to. Nobody can yet say how relevant smartwatches will be in the end.”

The Biel, Switzerland-based Swatch said its patent applications reached a record in 2014, adding it will be reflected in “numerous innovative project launches in all segments” this year. Such patents include batteries based on new materials that can double their performance, Hayek said.

Patent Destiny

“We’ll implement all of those into new products,” Hayek said. “Some of them, such as the battery, will take a few years though, and are also destined for other industries, like the automotive industry.”

The Apple Watch will feature health-tracking features and other applications for maps, photos, and messages. Apple CEO Tim Cook also rolled out a mobile-payment system last year. The Cupertino, California-based company hasn’t given information about the battery life of its smartwatch, which needs to be charged with a magnetic connector.

A few high-end Swiss watch brands, owned by luxury-goods makers LVMH Moet Hennessy Louis Vuitton SA and Richemont, have been dipping a toe into the market. LVMH’s TAG Heuer plans to release a smartwatch this year, featuring GPS functions and health monitoring. Richemont’s Montblanc has unveiled an “e-Strap,” an interchangeable watch band that can track the wearer’s activities and can help find the user’s mobile phone via Bluetooth technology.

Swatch is in talks with more retailers on its payment system after agreements with Switzerland’s two largest retailers, Migros and Coop, Hayek said. The device will enter the market in two to three months, he said.

The stock traded 3.3 percent lower as of 1:20 p.m. in Zurich, erasing an earlier decline of as much as 7.4 percent after reporting full-year earnings that trailed analysts’ estimates."

Something really is turning the watch industry upside down, in no time at all... Fascinating times, indeed (once more)!

Best,

Magnus

This message has been edited by Ornatus-Mundi on 2015-02-05 07:29:51

Key Points from the Discussion

Smartwatches, despite their technological advancements, are fundamentally technology devices, similar to how quartz watches were perceived, and may not entirely displace traditional mechanical watches.
The emergence of smartwatches could force traditional mechanical watch manufacturers to innovate further and potentially impact the pricing of luxury watches, which some perceive as inflated.
Smartwatches offer significant potential for evolution beyond their initial generations, with rapid advancements in sensors and software, suggesting they could become essential daily devices.
The market for smartwatches is expanding rapidly with many brands offering diverse styles, including those resembling traditional round watches, which could appeal to a broader audience.
While smartwatches may initially sell well to tech enthusiasts and brand loyalists, their small screen size could limit their long-term utility for many users.
Swatch's long history in developing relevant technologies like long-lasting, bendable batteries and touch-screen watches (Tissot since 1999) positions them uniquely to compete in the smartwatch market.

The Discussion

tom2517

Feb 5, 2015

It would be a mistake if any Swiss watch companies think smart watches is just another quartz crisis that they will endure. Quartz watches for the large part, still looks and acts like traditional watches, but smart watches could fundamentally change how people go through their daily lives. Look how quickly mobile phones has evolved from a big, ugly device (in 1980 McKinsey Consulting advised AT&T that mobile phones is just a niche market) to its present form. Frankly I am not that impressed

dr.kol

Feb 5, 2015

This year I bought already RO 15202 and Nautilus 5711. Next week I will also pay the third watch, a new interesting Blancpain. Purists are a very small part of watch buyers - the big masses are elsewhere. The smart watches will surely hit the producers of traditional mechanical watches as well as the producers of quartz watches. I think this development is great. The traditional watch manufacturers have generated huge profits during the last years and the prices of watches are insane. Never mind

AnthonyTsai

Feb 5, 2015

It'll sell at first because of the die hard Apple fans; but as a product itself, I don't think many people will find it useful because the screen is so small. That's my take on this topic. Cheers, Anthony

Mark in Paris

Feb 5, 2015

More seriously, I think it is the kind of thing that will work quite well because of fans of High-Tech stuff. I've just typed "smart watch" on google and the number of brands is much more important than I expected. Some really look like regular round watches and doesn't imply to accept to wear a huge case watch on the wrist. It will have all what a quartz can do, with even more functions. The more we will see new incomers, the better it will be for us: style choices, prices competition, technica

tom2517

Feb 5, 2015

It's certainly possible the first Apple watch will be a flop, don't see any killer applications for it yet. But the applications of wearable device are immense, my take on it is don't judge it by this first generations of smart watches. I mean, one could say the first few generations of cellphones is a flop too. Smart watches will impact the Swiss watch industry, eventually.

Ornatus-Mundi

Feb 6, 2015

who told the press today they were 'quite surprised' about Mr Hayek's statement and could not offer details on which payment system Nick Hayek was referring to. Best, Magnsu

Continue the conversation

This thread is active on the Horological Meandering forum with 9 replies. Share your knowledge with fellow collectors.

Join the Discussion →

Swatch Smartwatch Launch Announced by Nick Hayek

Key Points from the Discussion

Continue the conversation

More from this Forum