It will probably be a souped up iPod like the last generation. Put a watchband on it and u have a watch. Will appeal to niche Apple fan base. Wont move needle much because watches are way out of style.
1) an iWatch is likely to be mostly purchased by younger males and will not be subsidized via phone carriers - it doesn't have a chance to become as important as the iPhone is to Top Line or Bottom Line. At very best, it could add 5-10% to either or both, and it will be immediately met with stiff competition from the usual players.
2) By far the most important factor going forward will be the success of the iPhone - which accounts for the lions share of revenue and profits for AAPL. There is no substitution for iPhone on the horizon. None.
3) Any new product or product category should be strategically positioned to lead consumers toward needing the iPhone to enhance their overall experience (causing them to switch to an iPhone). An iWatch does not seem a good candidate for this.
Overall, an iWatch seems really 'cool' (mostly to males) but cannot have a significant impact top-line, bottom-line, nor as a new category.
And the same thing happened on the downside
What if's baked into the price
-no divi increase
-no China Mobile
Of those only one came true. All the others, save for China Mobile, have been proven false.
Way too much negative what ifs baked in. Nothing ever materialized. Hello.
MS thinks it will add 10-15 billion to annual revenue so do your own math considering the current market sentiment. My guess is if iWatch is more than an urban myth it is worth a 8%-12% pop at these levels and maybe less percentage at higher levels.
If the TV is also not just an urban myth MS sees as much as a 68 billion annual increase in revenue. That is an addition of $18.00 annual eps.