NEW YORK (MarketWatch) — Apple AAPL, -0.09% unveiled Apple Watch on Tuesday after several months of hype, however the reaction in the tech world has been largely ho-hum, if not outright disappointment.
The smartwatch will hit stores shelves in early 2015 with a $349 price tag. It will feature virtually everything that was rumored, including compatibility with new payments service Apple Pay.
However, the watch needs the iPhone 5 or a later version to operate, which doesn’t make it all that different from the way Galaxy Gear 005930, -0.74% and Motorola’s Moto 360 0992, +2.44% work.
Apple is known to completely shake up markets, delivering products in pretty, easy-to-use packaging that blow the minds of even the earliest tech adapters. The question now is: are expectations just too high? Or is the first-generation Watch just not all that exciting?
“The initial reaction was that it looked and appeared more compelling than expectations,” said Brian Fenske, director of ITG’s sales and trading unit for technology, media and telecom. “But I think as people sat back and absorbed it, they wondered whether it’s a transformative product category, the way the iPad was a category creator.”
“The initial look at the Apple Watch does not appear to excite investors, but consumers will be the ultimate judge.” Walter Piecyk, BTIG Reserach
While the Watch will inevitably draw significant media attention over the next few months, Fenske said it’s the iPhone 6, expected to hit shelves later this month, that will really be the revenue driver out of everything unveiled in Cupertino on Tuesday -- at least for now.
The problem, tech analyst Roger Kay says, is that the market still hasn’t identified a real need for a smartwatch, unlike when Apple introduced the iPhone a decade ago, or even the iPad in 2010.
“There’s a learning curve, and no one yet has figured out what they want to do with a digital watch,” said Kay, who serves as president of Endpoint Technologies Associates. “People are all watching each other saying, ‘I don’t know, is this a good thing?’”
Ramon Llamas, research manager of smartphones at IDC, said the Apple Watch looks just as Apple intended: a first generation smartwatch.
“If you go through some of these applications, a lot of these are similar to what we see for other devices,” Llamas said. “But how do you turn that from novelty-ware to ‘what can I really do here?’ Apple hasn’t yet cracked the code.”
To be fair, there was similar skepticism initially when Steve Jobs introduced the iPad, which was at first criticized as just a larger iPhone.
Shares of Apple closed down 0.38% to $97.99 on Tuesday after touching an intraday high of $103.08 during the event.
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