Even worse, the 800,000 only represents shipments, not sales. The Gear is also being found bundled with the Galaxy Note 3 and Galaxy S4, and in some cases, for free.
Forget Samsung in all of this. Focus on Apple. Investors and analysts are demanding an iWatch to prove innovation. But if it comes to market and sales do poorly, followed by product bundling, then game over.
I don't want to see a low margin, revenue-irrelevant product bundled with iPhones and iPads. That's not the Apple way. Not even close. It doesn't need to spend billions of dollars in research, just to break-even and "prove" that they can do it. Of course they can. It's already been proven!
We've seen Apple create strong revenues out of thin air before. Look at the iPad, which sold 14.1 million units last quarter, good for $6.2 billion in revenues and accounted for ~16% of fourth quarter revenues of $37.5 billion, ahead of a new product refresh. Impressive.So it's quite possible that, if done correctly, the iWatch could be good for the company's bottom line, though it's likely not a game changer. The price tag will be too low and consumer adoption will be too faint for it to truly make a difference. Apple still has strong iPhone and iPad sales. Each received a nice face lift into the holiday season, which should help propel the stock to a strong first quarter when it reports in January.
Hell, just the current products will give Apple a push through 2014. Especially as investors' hope builds leading into its next big thing and optimism swells around the new -- for real this time -- deal with China Mobile Limited (CHL). That "next big thing" will need to be different and viewed as a must have by consumers for it to make a solid dent in Apple's current war chest of products. The iPhone accounted for roughly 52% of its sales in the previous quarter. Seeing another product come to life and reduce some of that risk exposure would be nice. Plus, that would prove Apple can innovate. The iWatch could be awesome, but I'm not betting the farm on it. Two to three years down the road, wearable smartwatches could be capable of doing some really cool things. But for now, I just don't need a watch to tell me that I have a text. The two seconds it takes to check my phone is certainly enough, but maybe Apple can change that mindset.
At the time of publication, the author was long AAPL. -- Written by Bret Kenwell in Petoskey, Mich. Follow @BretKenwell