After crushing rival smartwatch sales, Apple Watch portrayed as doomed by CNBC

Posted:
in Apple Watch edited July 2015
CNBC has issued a stream of flawed reports suggesting calamity and doom for Apple Watch--already the world's most commercially successful wearable--with each article twisting data to say the opposite of the truth in order to deliver sensational clickbait.

Apple Watch


Despite constrained supplies that have sharply limited its retail availability, Apple Watch has found more buyers over the past quarter than every other smartwatch vendor (or even the entire Android Wear platform) managed to sell across all of 2014--by a huge margin.

All data shows Apple Watch has flat out trampled wearable rivals

Canalys reported that just 4.6 million "smart wearable bands" were sold last year, and just 720,000 of those used Google's Android Wear platform.

Smartwatch Group offered its own estimate on last years' "Internet enabled watch" sales, counting 6.8 million devices (including products like Nike Fuelband and other wearables from 40 different companies). By any measure, Apple Watch has immediately trounced every other vendor and platform right out of the starting gate.

The group reported Samsung to be in the lead with shipments of 1.2 million wearables (mostly running the company's own Tizen software, rather than Android), followed by Pebble's proprietary wearables platform of 700,000 devices in second place.

No vendor, including Apple, has released official sales data on smart watch sales. However, it's clear from all available estimates that in just two months Apple has already sold more than double the number of wearables Samsung shipped across 12 months of 2014, despite the wide portfolio of much cheaper Gear devices that have been available to buyers since 2013. By any measure, Apple Watch has immediately trounced every other vendor and platform right out of the starting gate.

Investment firm J.P. Morgan told investors it expects Apple to sell 26.3 million units before the end of calendar 2015. Rumors from the supply chain are even more optimistic, suggesting Apple could build as many as 40 million units in the first year if demand calls for it.

CNBC pits Apple Watch... against iPhone

It's so unflattering to compare Apple's Watch sales to the existing market for wearables from every other vendor that CNBC decided to instead compare Apple's initial Watch demand to iPhone 6.

Reporting on the Apple Watch launch in Singapore, Nyshka Chandran wrote for CNBC that "In tech-savvy Singapore, new Apple products typically trigger snaking lines spanning multiple blocks, but the Apple Watch got short shrift."

The article's headline claimed Apple Watch was met "with a shrug" in the country, despite observing that about 70 people were waiting in front of three retail stores the day they began selling the new product. No other watch in any country has lined up that many customers at launch around the world, with lines persisting weeks after the initial launch.

Paris Apple Watch launch week 2


The only way CNBC could denigrate the demand for Apple Watch is to compare to iPhone. However, when iPhone launched in 2007, the market for smartphones was already exceeding 122 million devices annually, and sales of basic mobile phones were greater than 1.15 billion units. The entire market for higher end watches is a tiny fraction of where smartphones were back in 2007, so Apple and its competitors are essentially working to create a new market.

Even so, back in 2007 Apple sold fewer iPhones in its first four months (1.4 million) than it has already sold in just the first two months of its Apple Watch launch. The lines are shorter primarily because supplies are so constrained in comparison to demand that the company has so far forced the majority of early adopters to buy online.

Comparing lines of Apple Watch and iPhone buyers to report a supposed lackluster demand for the latest new product demonstrates a breathtaking lack of understanding of either market.

Follow up report twists opinions to make broad generalities about potential buyers

However, a second report by CNBC, written by Uptin Saiidi, is even worse. It sought to establish the notion that consumer interest in Apple Watch was "dissipating," based on an excerpt cherry-picked from an ongoing "Ethnography Study" published by MBLM.

The MBLM study provided users with an Apple Watch and asked them to journal their experiences as they use it; the study participants weren't early adopter buyers who sought out an Apple Watch on their own accord.

Saiidi wrote that "millennials are dissatisfied with the watch," noting that "many reported the original thrill of using it began to dissipate after 30 days, with the watch starting to feel like a weak extension of their iPhone. Some even reported feeling guilt over wearing the Apple Watch, saying it was an ostentatious symbol of wealth, while others said the watch is simply frivolous."

While presenting the opinions as a statistic, Saiidi failed to note that the "brand intimacy agency" conducting the study only involved 11 participants over a range of ages. That means his generalized characterization of "millennials" was actually based on a very few individuals' comments.

When asked about the sweeping conclusions made from the comments of just "some" or "many" of fewer than a dozen participants (who didn't even buy a Watch), Saiidi claimed on Twitter that the study included "more than 850 surveyed," and that "11 were extensively interviewed."

@DanielEran @CNBC more than 850 surveyed. 11 were extensively interviewed.

-- Uptin Saiidi (@uptin)


That is not true. Mario Natarelli, a Managing Partner with MBLM, confirmed to AppleInsider that the study actually involved just 11 participants, noting that "we have amassed over 850 open ended survey questions and 40 hours of interview footage" from those users in a series of interviews conducted similar to a focus group.

That means CNBC had Saiidi report on a study he did not even understand, selecting only a couple negative comments while ignoring the rest of its findings to create a hit piece that presented the opinions of four focus group participants as a representation of the millions of people who actually chose to buy an Apple Watch. CNBC had Saiidi report on a study he did not even understand, selecting only a couple negative comments while ignoring the rest of its findings to create a hit piece

Informed of his misunderstanding of the study size, neither Saiidi nor CNBC have corrected the story. Instead, it was picked up by aggregators as legitimate reporting, and even cited by The Street in a post that claimed "millennial dissatisfaction" of Apple Watch was the cause of a slight downward change in Apple's stock price on Friday (it closed 0.59 percent lower than the previous trading day).

It only took one sloppy, inaccurate report to trigger a new series of dog-pile clickbait making unsubstantiated claims about an entire demographic based on the opinions expressed by four volunteers who didn't even buy a Watch for themselves.

What MBLM focus group participants really said

The actual findings from MBLM are actually mostly positive, including comments that "joy and wonder were the overwhelming emotional anchors experienced by participants," and that "happiness overcomes frustration. There are limitations with the watch, however, most trust Apple will work out the kinks."

The group observed that among participants, "consumer behavior shifts based on demographic differences. The young learn intuitively and are more social in their use, focusing on sending emojis, texts, and calling friends, while older users require more time to understand the functionality and are more interested in checking the weather and getting key notifications."

Natarelli concluded after the first week that "Apple Watch is an effective device because of its ability to develop a powerful and intimate relationship with users."

Apple Watch


After using it for a month, four users out of the eleven expressed some complaints about wearing it regularly, while others said "it was easier to use my watch than my phone at work," or that "when my phone is in my handbag and my hands are full, it just makes it much easier to use the watch."

Reporting that "millennials are dissatisfied with the watch" is no more accurate than saying "all people with jobs and/or handbags find Apple Watch easier than using a phone." Both are individual opinions, not a significant statistical representation of a broad demographic.

Earlier this month, CNBC also directed attention to speculation by 9to5Mac, "citing anonymous sources," that made unsubstantiated claims about FaceTime video hardware while also getting facts wrong about features such as tether-less WiFi, which Apple said it will bring to existing Watch customers in watchOS 2 later this year without necessitating a hardware upgrade as the site suggested.

Despite its industry-trouncing sales at launch, Apple Watch has, as noted back in March, incited more mocking disbelief, concerned handwringing and passionate prognostications of doom--for Apple, for its buyers, for society in general--than any product since iPhone, with the potential exception of iPad. Maybe Apple is onto something here.
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Comments

  • Reply 1 of 219
    Quote:

     Some even reported feeling guilt over wearing the Apple Watch, saying it was an ostentatious symbol of wealth,


    While the survey is bogus, many millennials are so brainwashed that this statement is not that out of character for them, sadly. I doubt they even used the word "ostentatious".

     

    All the sales speculation is pointless until Apple releases numbers. Given that everyone gets the iPhone numbers wrong I see no reason the Watch estimates (or estimates of sales of competing products) are any better.

  • Reply 2 of 219
    syrransyrran Posts: 42member
    Wow. His CNBC bio says he attended George Washington University and majored in business. If it's true that he misunderstood that only 11 people were interviewed, while it was 850 survey questions (and it is not clear if all were asked), not "850 surveyed" that is a damning indictment of the the George Washington University How could a business hire these graduates if they can't even get basic facts straight in order to reason to a justified conclusion. You would be risking your business entrusting anything to somebody like this. GW is supposed to be a decent school. I am very disappointed.
  • Reply 3 of 219
    iqatedoiqatedo Posts: 1,701member
    Quote:
    Originally Posted by AppleInsider View Post



    CNBC has issued a stream of flawed reports suggesting calamity and doom for Apple Watch...



    Despite its industry-trouncing sales at launch, Apple Watch has, as noted back in March, incited more mocking disbelief, concerned handwringing and passionate prognostications of doom--for Apple, for its buyers, for society in general--than any product since iPhone, with the potential exception of iPad. Maybe Apple is onto something here.

     

    Exactly, a sure sign. Can only say that my wife and adult daughter love theirs. They particularly like the intimacy the watch provides, both in their respective daily activities and also connectivity.

     

    All the best.

  • Reply 4 of 219
    pogo007pogo007 Posts: 43member
    Well it's very successful. I think it will be a matter of time before it starts losing popularity. When people start realizing it doesn't do much they will stop using it. It will be just like the iPad which started great and it took a few years for people to realize it's just a big iphone and that our iphone's can pretty much do the same exact thing. For the past few years I've only been using a MacBook Air and iPhone and I pretty much get everything done.
  • Reply 5 of 219
    solipsismysolipsismy Posts: 5,099member
    [QUOTE]When people start realizing it doesn't do much they will stop using it. It will be just like the iPad which started great and it took a few years for people to realize it's just a big iphone and that our iphone's can pretty much do the same exact thing.[/QUOTE]

    ^ Blocked.
  • Reply 6 of 219
    danielswdanielsw Posts: 906member

    I've had my iPhone 6+ since September and really love it. Though it fits easily into my Wranglers' front pocket, it is awkward to pull it out when I'm sitting down. My Apple Watch makes it much more convenient to check the time and notifications, as well as to take the occasional call.

     

    It's a great product, which will get all the better with 3rd-party apps and Watch OS2.

  • Reply 7 of 219
    rp2011rp2011 Posts: 159member
    I want to once again thank all of the magnanimous beta testers who are so selflessly working so hard to iron out all the kinks out for me.

    As well as the watch has sold thus far, this is only the beginning. Gen 2 and a discounted OG is when the fun really happens.
  • Reply 8 of 219
    danielswdanielsw Posts: 906member
    Quote:

    Originally Posted by pogo007 View Post



    Well it's very successful. I think it will be a matter of time before it starts losing popularity. When people start realizing it doesn't do much they will stop using it. It will be just like the iPad which started great and it took a few years for people to realize it's just a big iphone and that our iphone's can pretty much do the same exact thing. For the past few years I've only been using a MacBook Air and iPhone and I pretty much get everything done.



    Wrong. Not everyone is just like you. Just the opposite will most likely occur.

  • Reply 9 of 219
    Quote:

    Originally Posted by rp2011 View Post



    I want to once again thank all of the magnanimous beta testers who are so selflessly working so hard to iron out all the kinks out for me.



    As well as the watch has sold, this is only the beginning. Gen 2 and a discounted OG is when the fun really happens.



    I'm waiting for Apple Watch Air. <img class=" src="http://forums-files.appleinsider.com/images/smilies//lol.gif" />

  • Reply 10 of 219
    rogifanrogifan Posts: 10,669member
    Typical CNBC. Marketwatch is worse though. Their Apple stories are always negative. The media is bound and determined to make ?Watch a failure though. The latest is some stupid survey that claims millenials feel guilty about owning an ?Watch. :rolleyes:
  • Reply 11 of 219
    danielswdanielsw Posts: 906member
    Quote:

    Originally Posted by rp2011 View Post



    I want to once again thank all of the magnanimous beta testers who are so selflessly working so hard to iron out all the kinks out for me.



    As well as the watch has sold, this is only the beginning. Gen 2 and a discounted OG is when the fun really happens.



    I want to thank you and other fence sitters for transforming that practice into such an art form.

  • Reply 12 of 219
    slurpyslurpy Posts: 5,309member
    Quote:
    Originally Posted by pogo007 View Post



    Well it's very successful. I think it will be a matter of time before it starts losing popularity. When people start realizing it doesn't do much they will stop using it. It will be just like the iPad which started great and it took a few years for people to realize it's just a big iphone and that our iphone's can pretty much do the same exact thing. For the past few years I've only been using a MacBook Air and iPhone and I pretty much get everything done.

     

    What a shocking post from you, considering in pretty much every single one of your posts you're shitting on Apple and their products, and pessimistic about their future. Sad how you choose to spend your time. Also, that's quite the twisted logic you're using. As Apple Watch gains more features and more adoption, it will "lose popularity"? Unlike someone like you that basis all statements on ignorance, I'm pretty sure those who buy it have a good idea of what it can and can't do. 

     

    As for these reports, par for the course. Remember the 74,028 reports in 2012-2014 that stated that Apple was on a steep decline with iPhone, and Samsung would soon utterly destroy Apple in all the metrics that matter? Since then, iPhone sales have blown up and Samsung's flagship phones have collapsed.  Or that Apple had zero iPhone "growth left" - but today is destroying YoY numbers by 40-50%? The list goes on and on. These analysts do not understand Apple, have never understood them, and couldn't manage to even create a successful business if their lives depended on it. 

  • Reply 13 of 219
    rogifanrogifan Posts: 10,669member
    While the survey is bogus, many millennials are so brainwashed that this statement is not that out of character for them, sadly. I doubt they even used the word "ostentatious".

    All the sales speculation is pointless until Apple releases numbers. Given that everyone gets the iPhone numbers wrong I see no reason the Watch estimates (or estimates of sales of competing products) are any better.

    The worst thing about ?Watch coverage is everyone (including ?Watch owners) are tripping over themselves to say you don't NEED an ?Watch. As if everything else people buy is something they truly need. Who cares whether you need it or not. People spend money on all kinds of things they don't need.
  • Reply 14 of 219
    sphericspheric Posts: 2,058member
    rp2011 wrote: »
    I want to once again thank all of the magnanimous beta testers who are so selflessly working so hard to iron out all the kinks out for me.

    As well as the watch has sold thus far, this is only the beginning. Gen 2 and a discounted OG is when the fun really happens.

    It sure doesn't feel like a beta product to me...
  • Reply 15 of 219
    Quote:

    Originally Posted by Rogifan View Post





    The worst thing about ?Watch coverage is everyone (including ?Watch owners) are tripping over themselves to say you don't NEED an ?Watch. As if everything else people buy is something they truly need. Who cares whether you need it or not. People spend money on all kinds of things they don't need.



    Part of it is to counteract the claims of "Apple forces you to buy products", part of it is just because the product's use isn't as readily apparent as the iPhone and iPad were. It's more like the iPod in that regard; "why buy a $400 music player when I can use my $70 portable CD player?"

  • Reply 16 of 219
    mechanicmechanic Posts: 805member
    Quote:
    Originally Posted by Rogifan View Post





    The worst thing about ?Watch coverage is everyone (including ?Watch owners) are tripping over themselves to say you don't NEED an ?Watch. As if everything else people buy is something they truly need. Who cares whether you need it or not. People spend money on all kinds of things they don't need.



    Pretty much anything you spend money on with the exception of basics, food, shelter and family are things you don't need.  So I would have to agree with your sentiment on that.  I bought an ?Watch because I use it for running and it is an excellent fitness tracker which will only get better with native apps an WatchOS 2.  All the rest it does is gravy for me, I especially like Apple Pay with it. 

  • Reply 17 of 219
    inklinginkling Posts: 731member
    Hilarious! Look at that line of people waiting for their first chance to get an Apple Watch. Wow, there must be at least thirty people in line. I've seen many times that waiting in line when all Apple was doing was opening a new store and giving away free t-shirts. That leaves me wondering if CNBC is more in touch than AppleInsider.

    Smartwatches are a technology whose time hasn't come. Can you really cram enough user input and output into a small watch face to make the gadget worthwhile for most users? So far, that's not been demonstrated. The Apple Watch is what it is being marketed as, a pricey style accessory not a useful tool for most people.

    That said, Apple will probably benefit from its investment. Some of the techniques it was forced to develop for its smartwatch may prove more valuable on its other devices. And by dominating this still immature market, Apple makes it harder for a competitor to take over the smart watch market like the iPhone took over the smartphone market. It's guarding its rear and flanks.
  • Reply 18 of 219
    mac_dogmac_dog Posts: 878member
    of those trashing the watch, i wonder how many have actually seen & used one.

    i happened to see one the other day—ss milanese 38mm. what a magnificent piece of art. amazing interface—just the timing of the transitions alone.
    it really is a quality piece of jewelry and well worth the money. if i had the money, would buy one just to keep time.
  • Reply 19 of 219
    newbeenewbee Posts: 2,055member
    Quote:
    Originally Posted by pogo007 View Post



    ...... When people start realizing it doesn't do much they will stop using it......

    That's just hilarious, wow. You do, of course, realize that an ordinary watch does one thing only, i.e. tell time, and they have been around for 100 years or so and people who still buy them haven't stopped using them yet so I think that, in spite of your "prediction" Apple has nothing to worry about. You, on the other hand, should try to find a different path to walk on.  ;)

  • Reply 20 of 219
    newbeenewbee Posts: 2,055member
    Quote:
    Originally Posted by Inkling View Post



    Hilarious! Look at that line of people waiting for their first chance to get an Apple Watch. Wow, there must be at least thirty people in line. I've seen many times that waiting in line when all Apple was doing was opening a new store and giving away free t-shirts. That leaves me wondering if CNBC is more in touch than AppleInsider.



    Smartwatches are a technology whose time hasn't come. Can you really cram enough user input and output into a small watch face to make the gadget worthwhile for most users? So far, that's not been demonstrated. The Apple Watch is what it is being marketed as, a pricey style accessory not a useful tool for most people.



    That said, Apple will probably benefit from its investment. Some of the techniques it was forced to develop for its smartwatch may prove more valuable on its other devices. And by dominating this still immature market, Apple makes it harder for a competitor to take over the smart watch market like the iPhone took over the smartphone market. It's guarding its rear and flanks.



    You should change your "name". It's misleading because I don't even think you've got one.

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