Apple Watch SE: Why It Matters To Investors
The star of Apple’s September product refresh day was the Watch – the event itself, “Time Flies”, was named after the product category. The Cupertino company announced two new models: Series 6 to replace Series 5, in a highly anticipated move, and a brand-new SE that caught me a bit by surprise.
Beyond the product features, I believe that the announcement of the new Watch SE is important to investors for one key reason: it expands the wearable device’s total addressable market – which I pointed out in real time, in my live blog coverage.
The importance of the Watch SE
Let’s start with the graph below. Had the Watch SE not been announced this week, Apple’s product portfolio would have left a gap between the high and the low ends of the value spectrum.
Starting at $199, the Watch Series 3 caters to price-sensitive consumers who do not mind passing up on some of the better features of the device, but at a bare-bones configuration. Starting at $399, the Watch Series 6 offers all the bells and whistles, but at a price point that will likely shun consumers looking for “a good deal”.
Apple’s move to introduce the Watch SE served to close the gap between the two extremes – see graph below. Starting at $279, the SE offers some of the most compelling features of the Series 6, including a larger case and cell connectivity, at a price point that sits about halfway between the other two models.
With the current lineup, I believe that Apple will be able to “bring the Watch to masses” at a much better product configuration. This, along with the introduction of the Fitness+ service, may be the nudge that some consumers needed to finally give the wearable device a try.
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