Maintaining his stand about smartwatches being too small, their batteries too weak and their designs inelegant, Nick Hayek, CEO of Swatch Group says that Swatch are now integrating a few smart functions in their existing timepieces rather than producing dedicated smartwatches.
To be equipped with near field communications technology, the new watches will be able to perform functions like cashless payments and hotel-room access. A tiny chip and antenna in each watch will ensure they won't need constant recharging.
Speaking to WSJ, Mr Hayek said “We are not a consumer technology company. We don’t want to produce a reduced, minimized mobile phone on your wrist.”
The sudden popularity of smartwatches is now threatening traditional Swiss watchmakers like Frederique Constant SA, Mondaine Watch Ltd, Tissot, Rado, Mido and Swatch. Frederique Constant SA and Mondaine Watch Ltd have already unveiled their new smartwatches to curb the trend.
Hayek's statement comes soon after Apple announced the launch of the much anticipated Apple Watch. With prices ranging from $350 to $10,000, the Apple Watch will compete with most low-level and mid-level traditional watches. Given that almost a third of its revenues are generated from these markets, Sawtch has acted swiftly, signing a payment deal with China UnionPay as well as new deals with a Swiss bank and an unnamed credit card company.
Luca Solca, analyst at Exane BNP Paribas, told WSJ that smartwatches could capture around $500 million worth revenues from traditional Swiss watchmakers. Given that taking on the Apple Watch could be a risky proposition in the long run, Mr Hayek appeared conciliatory. Terming the Apple Watch as the 'nicest smartwatch he'd seen,' he said there was room from both types of watches in the market.
We would wait and watch until both Apple and Swatch reveal their quarterly figures at the end of the year.