Apple's iWatch and Some Crazy Gold Numbers

bpm -

Having been in gold & jewelry industry for 35 years--and having melted thousands

of 14k/18k gold watch backs--I was indeed surprised at the claim that APPLE Corp

would need to buy 1/3 the world's Gold for its new iwatch 2015 production?

I immediately emailed Josh at TIDBITS to tell him his case estimates were off by

at least 2x. Pictures of the case soon appeared with more real looking size and

weight at the vrzone:

http://vr-zone.com/articles/apple-watch-estimated-to-contain-29-16-grams-of-gold/87351.html

Not just 2oz of heavy weight but less than an oz a newer estimate. But the other

end of the estimate would be the secret/mysterious (and wrong) marketing plans

for selling the high end Watch Collection. My argument is over the wild thoughts

that APPLE was going to make millions of high end watches!

When we look at the total watch market we see the following: The Swatch Group

controls only 2.5% of the total quantities sold, but approaching 60% watch by

value (i.e. billions units sold @avg $3 vs 54% for the high end gold watches):

http://www.wthejournal.com/en/pages/swiss-watch-industry-figures

Gold watch by in large are only 2% of the market, but doubles to 4% with bi-

metals as case work. So it's a small market if APPLE wants to realistically wants to be in the high-end class. Given that they plan to mfg 8million units

in plastic (geek variety Swatch watch) at a price already 10x for the market,

we can work backwards to some high-end estimates of perhaps 1000's units?

Well thank god, Gene Munster has weighted in on the subject. Gene actually

goes to the APPLE factories to see what's up and he estimates that perhaps

1000 units/month may be possible (starting at $4,999, Apple might sell around 10,000 units in CY15 [calendar year 2015] of our total 8 million estimate, Munster said).

http://www.cnet.com/uk/news/apple-watch-edition-pegged-to-sell-for-4999-by-analyst/

How does this effect the world Gold markets?

NOT MUCH....THANKYOU.

By the way, ever since the wild claims to vast quantities of required World

Gold Reserves needed....the world markets have been going down....and probably

continue through the CY15 production period. Further, APPLE wouldn't be in the

world's market looking for Gold anyway. As it would up to the case supplier to

insure enough raw materials to contract the order.

I wouldn't be surprised that high-end Watch Collection orders would be handled

on a-delivery-order basis. Rumors are also rampant that APPLE stores are going

to install high-value storage & inspection facilities to prevent thief? Why

put and stress your employes to strong arm gangs from robbing store products?

APPLE doesn't want to be in the high-end jewelry business for a variety of

reasons. Thief is a good one...but violence from thieves is a better one.

The iWatch isn't even here yet, and APPLE has already changed the health/med

features from the original promises. Gone are all those claims for Health uses

as the FTC advised them that all those proposed pickup sensors can vary from

person to person and worse...can't be reliable from medical uses. Those sensor

probes were on the bottom of the plastic cases, by going to metal (by design)

the sensors can be compromised....and the deployment buckle would become a

bigger medical problem, etc.

The high-end dress up watch market wants something different than a gook look,

it want something that screams RICH-VALUABLE-PRESTIGE. Again, that's not APPLE

Some geek estimates include a diamond bezel as an additional price for the out

of this world wrist piece!

It's all Bull Crap to hype the market. APPLE, according to Munster, may indeed

capture a big chuck of the little watch pie, but I fear that estimates of the

Gold versions are unrealistic. Do the Swiss Watch Makers fear this product? I

think rather they are holding back laughter as their market empires are safe.

You can go to the bank on that...