What threatens Apple? Here's what has pros worried - CNBC

While Wall Street is hopeful that the Apple Watch will be a new revenue generator, the company still runs the risk of weak consumer adoption.


"I think the Watch, does it really become the next product for them or is it just a cool accessory? They need it to be the next product, a new category for them. If it's not, if it doesn't become one like some of the other smartwatches out there, that's a downside risk," Basenese said.


Poor battery life, not enough use cases and high price point are just a few of the things that could also deter consumers from purchasing the device, industry experts said.


"It's probably the use cases and the battery life. Why does one need to go out and buy an Apple watch, suddenly having a product that needs to be charged every day? It's not the most convenient thing," Daryanani said.


Still, though, Daryanani said that he estimates Apple will begin selling the devices in March and will sell 20 million units at an average price of $520 in 2015. In total, he predicts that Apple Watch sales will come to $10 billion in additional revenue and 40 cents in earnings per share. Given that the Apple Watch is only compatible with models of the iPhone 5 or later, though, he said estimates should remain conservative.


Besides adoption of the watch, investors should also be keeping an eye on how well Apple Pay fares, Basenese said.


"If traction isn't significant right out of the gate, they are going to be playing catch up. Apple will have to explain why they aren't getting more adoption," Basenese said. "They have the credit cards on file, they have the smartphones in peoples' hands, there are plenty of places where consumers can use it. Explaining why they don't have traction, would become a significant problem."


Apple did not immediately respond to a request for comment. Still, the company seems confident of its chances for success. CEO Tim Cook said during Apple's last earnings conference call that demand for the iPhone 6 is "off the charts." He also said that "we are heading into the holiday season with Apple's strongest product lineup ever." And "we are also incredibly excited about the Apple Watch and other great products and services in the pipeline for 2015."


Apple also predicts that it will sell more products in the three months leading up to January than it did in all of 2010.






via apple - Google News http://ift.tt/124GmHY

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