On Apple Watch Pricing and Obsolescence

John Gruber wrote a great piece this week where he postulates the possible pricing of the Apple's watch. What's specifically interesting is the pricing of Apple Watch Edition, where he puts it firmly in the realm of you need to be rich to own one:

Most people think I’m joking when I say the gold ones are going to start at $5,000. I couldn’t be more serious. I made a friendly bet last week with friends on the starting price for the Edition models, and I bet on $9,999.

The lowest conceivable price I could see for the Edition models is $1,999 — but the gold alone, just as scrap metal, might in fact be worth more than that. Here’s a link to a forum discussion pegging the value of the gold alone, as scrap metal, of a Rolex GMT (including bracelet) at $5–6000. Just the gold alone.

Also, on the latest Accidental Tech Podcast, Marc Arment, John Siracusa and Casey Liss question who's going to buy something that expensive when it has built-in obsolescence where a rolex does not? This is a great point, but there may be an angle that Apple can approach this from a truly Apple-eque way.

What if the Apple Watch Edition comes with a replacement plan?

This may sound crazy, but think of it for a moment. With the solid gold Apple Watch Edition carrying so much value, there would be benefits to Apple providing customers of this watch a sort of guaranteed replacement (or upgrade) plan. While the electronic components will eventually become outdated as Apple releases new versions of its watch, the gold should in fact keep its value. What if after a year or two of owning an Apple Watch Edition, one could walk into an Apple Store (or Apple Boutique?), pay a small premium and get a new version of the watch? This would definitely answer the question of owning a $5,000 watch that would become obsolete after a few years.

What's more is that Apple could recycle most of the components in the watch. The electronics could be recycled and the gold could be melted in order to make new watches. We all know the importance Apple places on its carbon footprint.

Further, what if the bands are a sort of new dock connector?

Bands will become collector's items. Although only a specific set of bands will be available for the launch, it is fully conceivable that other manufacturers (think Vertu) will make bands that cater to a very specific segment of the market. If Apple developed the band mechanism with longevitiy in mind, then there is a certain value knowing that investing in a series a bands for various occasions will allow you to bring those bands to future Apple Watches.

There is a lot of speculation about how Apple will tackle these problems but if one thing's for certain it's that we don't yet fully know nor understand Apple's hand.

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