Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options. HOMEPAGE

Here's How Apple Might Be Able To Justify Charging $10,000 For A Top-Of-The-Line Apple Watch

Apple Watch Edition rose gold
Apple Watch Edition in rose gold. Apple

Apple writer John Gruber made waves when he suggested that Apple might charge $4,999 for the top-of-the-line gold Apple Watch. 

Advertisement

He went further, saying he made a friendly bet that Apple would charge $9,999. The lowest price he could envision Apple charging is $1,999. 

These are high prices, especially for a first-generation technology gizmo that is likely to be useless in the next four years.

Apple has already announced that the Apple Watch will start at $350 for the entry model, but it didn't say how much it would be charging for its high-end models. So, $5,000 is entirely possible.

tim cook
AP


Gruber's rationale for the high price: The gold Apple Watch is solid gold, which is expensive. He says you can't find a top-of-the-line gold luxury watch for under $20,000. Therefore, there's no reason to think Apple is going to be cheaping out with its gold watch. 

Advertisement

The problem, beyond cost, with charging $5,000 for an Apple Watch is that technology moves quickly. A $20,000 Rolex is going to be valuable for the next 50 years as it's passed from generation to generation.

Compare that to, say, the first iPad, or the first iPhone, which is utterly worthless. If you have an original iPhone, it probably barely works. It will struggle to support any current apps or features. It's obsolete. It's not even valuable as a collector's item, because Apple made millions of them. 

So, who would pay $5,000 for a watch that's going to be obsolete in four years?

apple watch
Apple

In a three-hour podcast talking about the Apple Watch, Gruber had an idea about how Apple could justify the high price tag for anyone worried that his or her expensive watch would turn into an expensive brick in a few years. 

Advertisement

He speculated that Apple could make the computer chip that powers the Apple Watch replaceable. This would keep the watch valuable because you would just upgrade its internals from time to time.

In fact, it could make the Apple Watch even more valuable as a timepiece. It would be a first-edition collector's item that would grow in value over time.

This seems to be just wild speculation on Gruber's part. It doesn't seem to be based on talking to people who work at Apple. However, Gruber is generally a pretty smart guy, and he is in touch with people at Apple, so who knows. Either way, it's an interesting thought experiment. 

Gruber's idea seems to be inspired by the webpage Apple set up for the technology in the Apple Watch. It has a special section dedicated to the S1 chip. Here's what it looks like.

Advertisement
Apple S1
Apple's S1 page. Apple


The key thing to Gruber seems to be the following: "We found a way to integrate many subsystems into one remarkably compact module, which is then completely encapsulated in resin to protect the electronics from the elements, impact, and wear. Configuring an entire computer system on a single chip is an industry first and represents a singular feat of engineering and miniaturization."

The wording here makes it sound as if there's a chance that Apple would be able to remove the S1 and replace it with, say, the S2 or S3 in the future. After all, Apple has the entire computer on one chip. It just has to rip out that little computer and replace it with a new one.

As Apple upgrades the computing power, it could replace the chip for, say, $500, Gruber suggests. This sounds high, but this is what it costs to service a high-end luxury watch every few years. If this were to happen, it would solve the problem of turning the watch into an obsolete brick after a few years. 

There are, obviously, quite a few problems with this idea. Apple's innovations and progress don't happen only on the outside of its gadgets. While we all see the outer designs of Apple products changing, what's happening inside the products is even more radical on a year-to-year basis. 

Advertisement
iPhone internals
iFixit/iFixit


For this idea to work, Apple would have to be committed to the same shape for S-chip for a long time. Perhaps forever. This seems unlikely, but then again the general shape of the A-chip that powers the iPhone has remained relatively constant. 

A7 apple ipad air
Apple


The other parts of the watch would evolve, and perhaps this would be a problem for the S chip to power the Apple Watch. But, Apple says the entire computer is on one chip, so there shouldn't be much else in the phone other than a battery.

This is all speculation, but it's a lot of fun to think about. Apple would totally upend the traditional gadget model, and it would (somewhat) justify spending thousands of dollars on a watch, because the watch would be useful for years and years to come.

Apple Apple Watch
Advertisement
Close icon Two crossed lines that form an 'X'. It indicates a way to close an interaction, or dismiss a notification.

Jump to

  1. Main content
  2. Search
  3. Account