Swatch Group AG plans to start selling a smartwatch within the next three months, potentially pitting the Swiss maker of colorful plastic timepieces against the debut of Apple Inc’s Apple Watch.
The device would communicate via a form of technology known as near field communication (NFC) and would not have to be charged, CEO Nick Hayek said in an interview.
The Swatch smartwatch would also let consumers make mobile payments and work with Windows and Android software, he said.
Photo: Reuters
Hayek is ready to go head-to-head with Apple, which has scheduled its smartwatch introduction for April. The market for such timepieces, which enable phone or data communication, is expected to reach about US$10 billion in 2018, Citigroup Inc analysts forecast last year, with half of the market coming from traditional watch wearers switching to the devices.
Swatch has decades of experience developing technology that might go into a smartwatch, such as long-lasting batteries so thin they are bendable. The company’s Tissot brand has made watches with touchscreens since 1999 that now offer an altimeter, a compass and sensors to record a diver’s descent.
Hayek has been skeptical about the smartwatch’s potential. Two years ago, he said that he did not think the smartwatch would be a “revolution” for the industry.
He has repeatedly voiced concern that watch screens are too small for communicating and that such devices might need too much charging.
Last year, he said Swatch would not participate in a race to be first in developing the products because of consumer resistance. He once said Swatch luxury brands’ products such as Blancpain are smartwatches because “they make you look smart.”
“Entrepreneurs are practical people, and they care more about being successful than being consistent,” Exane BNP Paribas analyst Luca Solca said. “Hayek has always said they have relevant technology for a smartwatch — sensors, display, battery — and seems to be set to make the most if it. Better to have an option and a hand in this category than not to. Nobody can yet say how relevant smartwatches will be in the end.”
The Biel, Switzerland-based Swatch said its patent applications reached a record last year, adding it would be reflected in “numerous innovative project launches in all segments” this year. Such patents include batteries based on new materials that can double their performance, Hayek said.
“We’ll implement all of those into new products,” Hayek said. “Some of them, such as the battery, will take a few years, though, and are also destined for other industries, like the auto industry.”
The Apple Watch is expected to feature health-tracking features and other applications for maps, photos and messages. Apple CEO Tim Cook also rolled out a mobile payment system last year. The Cupertino, California-based company has not given information about the battery life of its smartwatch, which needs to be charged with a magnetic connector.
Swatch is in talks with retailers on its payment system, Hayek said, without naming them. The device is expected to enter the market in two to three months, he said.
Swatch shares closed 2.9 percent higher in Zurich yesterday, erasing a drop of as much as 7.4 percent after Swatch reported full-year earnings that trailed analysts’ estimates.
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