Swatch signs deals for NFC payments in face of looming smartwatch threat

12 Mar 2015 | Author: | No comments yet »

In smartwatch war, Swatch goes for cheap, quick and China.

CORGEMONT, Switzerland (Reuters) – The world’s largest watchmaker unveiled its riposte to Apple Inc’s smartwatch on Thursday, announcing a plan to put cheap programmable chips in watches that will let wearers from China to Chicago make payments with a swipe of the wrist. From left: Seiko Astron GPS Solar SSE013; Timex Intelligent Quartz Tide Temp Compass; Edifice ERA-300RB-1A Racing Watch; and Casio CA53W-1 Databank Watch Photo: F.

Nick Hayek, chief executive of Swatch Group, says near-field communications technology removes some of the perceived limitations of smartwatches, enabling some smart functions to be integrated into its existing lineup of timepieces.UBS’s Steven Milunovich and Peter Christiansen have a note out on Apple (AAPL) today, about what they see as the Apple Watch’s main opportunities in the wearable space. Swatch Group will start offering watches with near field communication (NFC) chips within two months, chief executive Nick Hayek said at a news conference on the company’s annual results which were released last month. Sharon Chan, Sotheby’s Head of Watches Asia, displays a set of James Bond 40th anniversary watches as part of a 5,800 Swatch watches and related artworks collection during a preview in Hong Kong on Tuesday, March 10.

Martin Ramin/The Wall Street Journal, Styling by Anne Cardenas THE FUTURE OF THE WATCH will soon be upon us, as Apple’s much-hyped announcement earlier this week made clear, and this future has touchscreens, app integration and a sexy interface. They interviewed Sonny Vu, founder of Misfit Wearables, for his take on the Apple Watch, and note that of the total watch market of between$60 billion and $70 billion in annual sales, 80% comes from watches that cost more than $500.

The Swiss company’s strategy appears to revolve around including individual tech features in different models rather than going head to head with Apple, the world’s most valuable firm, to create all-in-one smartwatches combining many functions. “We are the world champions of integrating smart functions into a watch,” Hayek said. “We don’t want to produce a mini mobile phone on your wrist. Hayek dismissed smartwatches; the son of Swatch’s founder grumbled the screens were too small, batteries too weak and designs inelegant, particularly for customers of conventional brands like Swatch’s Breguet. Apple enters wearables with two big advantages, according to Sonny: (1) other than Pebble, Apple Watch is the only wearable that works with iOS since most others are Android-compatible—in that sense Apple Watch has no competition; and (2) Apple offers customization, which no other wearable has.

Others can do that.” Apple’s watch will go on sale in nine countries starting in April, priced from $349 for the smaller model and $549 for the standard version, although a high-end “Edition” watch will sell for at least $10,000. “It’s a fantastic opportunity for us. That technology will allow the watches, which will range from the company’s eponymous plastic brand to its high-range Omega line, to be used for tasks like cashless payments and hotel-room access.

The technology consists of a tiny chip and an antenna, so the watches won’t require daily recharging. “We are not a consumer technology company,” Mr. The most detailed data on this problem, a July 2014 Endeavor Partners study, tells us that about a third of all smartwatch and fitness band owners abandon their wrist wearables after six months. On Monday, Apple hosted a 90 minute event in San Francisco at which it boasted about Apple Watch’s features and introduced models that blur the line between technology and fashion. I congratulate them.” Both firms’ strategies could co-exist and succeed, Hayek said, before adding a dig at the bigger rival: “Upgrading software every year, that’s not our business.” For its near-field chips, which will cost around 2 francs ($2) per watch, Swatch has teamed up with China UnionPay, the Chinese credit card association, as well as a Swiss bank and a major credit card company.

The water’s…precisely 71 degrees.”) The watch also comes equipped with Indiglo illumination for pre-dawn bait-fish raids, a compass, and a tide tracker for timing and aligning all your seaborne adventures. Meanwhile, Apple’s high-end models, which sport price tags of more than $10,000, will likely hit midlevel Swiss watches, the core segment of the market. Swatch is also launching a range of sports-themed “Swatch Touch” smartwatches which will be able to “buddy up” with a smartphone via a Bluetooth connection. Neatest Trick: Activate its compass mode and the second hand will point due north while the digital display shows the cardinal direction that the watch’s 12 o’clock position is facing.

Already, Frederique Constant SA and Mondaine Watch Ltd. have unveiled smartwatches to blunt Apple’s advance into fashion, which it has announced with an advertising insert in Vogue. There’s also a digital thermometer, five alarms, a stopwatch and a countdown timer—to get you first-away-from-the-stoplight bragging rights every time. Smartwatches could eat as much as 10% of sales of Swatch’s entry-level plastic brand and 5% of its midmarket brands, which include Tissot and Mido, in 2015, according to estimates by Luca Solca, an analyst at Exane BNP Paribas.

Trust me: I’ve been reviewing smartwatches since they became a thing, and once you run out of juice the first time, you’re already on the path to giving up. But it’s also essentially useless, as none of these watches’ heart rate sensors can provide accurate real-time readings during the jumping and jostling of physical exercise. Now, sure, you could argue that some smartwatch features are must-haves, that a smartwatch isn’t a smartwatch unless these features are present and accounted for.

Indeed, Apple’s small, ostensibly trivial surprise-and-delight tricks (taps, sketches, stickers, and custom animated emojis) might be all the Watch requires to be a resounding success. So while you might buy the upcoming Apple Watch, you may not buy its second-gen follow-up if you feel you didn’t get your money’s worth, or some borderline features just didn’t work.

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