For the first time since the debut of the original iPad in 2010, Apple (NASDAQ:AAPL) is expected to enter a new product category this year with the launch of the so-called “iWatch.” The wrist-worn wearable tech device will be Apple’s first entry into the burgeoning wearable tech market that market research firm IHS predicted could grow to nearly $60 billion by 2018. Based on Apple’s impressive track record of success with new product categories, most analysts have high hopes for the iWatch.
On the other hand, without any previous iWatch sales numbers to use as a baseline for predicting future sales, analysts have had difficulty reaching a consensus on how many iWatch units Apple will likely sell in the first year of availability. According to a research note obtained by the Financial Post last month, RBC Capital Markets analysts Amit Daryanani and Mark Sue believe that Apple will sell approximately 50 million devices during the first year of availability. Meanwhile, according to Barron’s, Evercore Partners’ Rob Cihra offered a more conservative estimate of 18 million iWatch units sold during the same time period.
Some analysts have used existing smartwatch sales and various percentages of the iPhone’s installed base of users to calculate their iWatch sales estimates. However, this is an incorrect approach to predicting sales numbers for the iWatch, according to Morgan Stanley analyst Katy Huberty. In a note to investors obtained by AppleInsider, Huberty argued that analysts should instead be looking at Apple’s history of dominating new product categories that it enters, as it did with the iPod in the digital media player market and with the iPhone in the mobile phone market.