1. Apple Watches, being dependent on processors, are likely to be susceptible to obsolescence — unlike a mechanical Rolex that’s handed down for generations.
3. Cook wears a demonstration Apple Watch on his own wrist at a September 2014 event at Flint Center in Cupertino.
4. Apple CEO Tim Cook (center) speaks with model Christy Turlington Burns (right) at the Apple Watch demonstration area during the event at Yerba Buena Center unveiling Apple’s newest attempt to create a consumer sensation.
Apple’s most expensive timepiece — named the Apple Watch Edition — features an 18-karat gold case and a display protected by polished sapphire crystal. Retailing for as much as $17,000 when it hits stores in April, that version aims at the same customers as Rolex and other luxury watchmakers.
While costly mechanical watches have a history of holding, and sometimes gaining, value, today’s smart watches are likely to lose it because obsolescence is written into digital technology. When the Apple II debuted in 1977, it was a marvel of modern computing. Today, it goes for $50 on eBay — less than many typewriters.
For buyers of Apple’s most expensive watches, what will happen when, presumably, the Apple Watch II hits shelves, or furthermore, if iPhones — which the smart watches largely depend on — go out of vogue?
Bound for recycling?
“It’s something you’re going to wear and use, and the new one’s going to come out and you’re going to recycle it out,” speculated Jacek Kozubek, a partner at H.Q. Milton, a watch dealership in the Mission. (His store doesn’t sell any digital watches.)
Though often seen as an indulgence for those who can afford it, Rolexes — highly valued in a collectors’ market — are more likely to hold their value than an Apple Watch in the same price range, Kozubek said.
In an extreme example, Kozubek said, “There’s pieces that we have bought that sold in 1968 for $400, and then we sold that watch for like $120,000.”
Wearing well
In a sense, mechanical watch technology has already been optimized: High-end watches are filled with tiny, highly engineered gears perfected over the centuries that keep them ticking for a long time. Kozubek said he recently bought a watch that is still remarkably accurate, considering it hadn’t been serviced since 1958.
“There’s this soul in pieces like that,” Kozubek said. “It’s something that was meant to be used and given to the next generation, as opposed to a lot of things that are designed now. There’s an obsolescence that’s engineered into” the smart watch.
Smart watches, on the other hand, are still new, and their underlying technology is still evolving. Unlike typewriters, landlines and mechanical wristwatches, computers, smartphones and smart watches are powered by processors. And processors get better and faster every couple of years, making anything that isn’t of the current generation feel comparatively ancient.
“Try to sell your first-generation iPhone — there’s nothing cool about it,” Kozubek said.
When technology doesn’t become obsolete fast enough, that can also be an issue for high-profile tech companies. Take the iPad, whose sales may have declined partially because early versions of the product simply work fine today, and consumers haven’t felt a need to replace them.
Apple isn’t the only high-end brand to take a mechanical product digital.
Leica’s example
In 2006, the high-end German camera manufacturer Leica released its first digital camera, aimed at replacing its iconic film camera. The digital M8 hit stores priced around $4,800. Now, a used M8 — with fewer megapixels than some phones — can be found online at less than half that price.
“The M8 is a pretty dated camera,” said Richard Wilson, the camera sales department manager at Adolph Gasser Photography in San Francisco’s South of Market neighborhood. When it comes to the older digital models, “People want to buy Leica mostly because of the little red dot on there, because it comes with a certain prestige,” he said.
Leica’s film cameras, on the other hand, have retained more value on the used market — even as the film photography industry has shrunk.
Most Apple Watch buyers won’t go for the costliest versions — meaning they likely won’t object to replacing the wearable in a few years when the next new thing comes out. Considering that the watch starts at $350, they might treat it just like they do a phone.
The question is whether the opulent Apple Watch Edition also winds up shoved in the back of the drawer, beside the old iPhones.
