The Plus Size iPhone And Apple (AAPL) Watch Made For Each Other?

Matt Yglesias explains the genius behind Apple’s (AAPL) new plus size phone and its watch:

Of course that still leaves you with the question of how to do quick one-handed tasks on the go. The ideal thing, really, would be to pair the large phone with some kind of device that’s truly optimized for quick glances. Something that’s even easier to access than an item carried in your pocket. Something strapped to your wrist maybe. In other words, while last month’s Apple super-fan sported a laptop, an iPad, and iPhone the company’s dream customer of the future will have a laptop, an enormous phone, and an Apple Watch. And the fact that the Apple Watch looks so much classier and better than the Android smartwatches on the market is going to give Apple a whole new boost of competitive advantage, even as the playing field in phones levels.

I suppose that there exist not a small number of Applesters who will deck themselves out in the manner Yglesias describes. Still it seems a stretch to suppose that this represents the market for several reasons.

  • The universe of users who are going to shell out two to three thousand dollars for Yglesias’ configuration is not large.
  • The market for smart watches is nebulous at best. Yes, Apple’s watch is stylish but it suffers from the same usability issues as the Androids and just like them has to be recharged at least daily. It will be interesting to see in a year or so how many smart watches of any sort are collecting dust in drawers.
  • The pure tablet market is not a growth market. Sales have leveled off and there isn’t any app on the horizon which would drive an uptick in sales. It would appear that consumers are content to split their usage between regular sized phones and laptops rather than throwing a tablet into the mix.
  • The introduction of the tablet laptop hybrid adds a new dimension. While admittedly not perfect they’ve come a long way and it seems reasonable to assume the hybrids will evolve to a more satisfying product. If consumers do move to this product then the regular sized phone would appear to be the default option. Actually, it’s a bit puzzling that Apple hasn’t jumped into this space though it would canabilize their tablet and plus size iPhone  6.

By all accounts the new Apple products are doing exceptionally well, notwithstanding the bending and operating system issues. The company is still a world class designer, manufacturer and retailer of exceptional products. They just have a lot more competition and it is unlikely, at least as I see it, that they have somehow created a new ecosystem for the application of smart devices.

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About Tom Lindmark 401 Articles

I’m not sure that credentials mean much when it comes to writing about things but people seem to want to see them, so briefly here are mine. I have an undergraduate degree in economics from an undistinguished Midwestern university and masters in international business from an equally undistinguished Southwestern University. I spent a number of years working for large banks lending to lots of different industries. For the past few years, I’ve been engaged in real estate finance – primarily for commercial projects. Like a lot of other finance guys, I’m looking for a job at this point in time.

Given all of that, I suggest that you take what I write with the appropriate grain of salt. I try and figure out what’s behind the news but suspect that I’m often delusional. Nevertheless, I keep throwing things out there and occasionally it sticks. I do read the comments that readers leave and to the extent I can reply to them. I also reply to all emails so feel free to contact me if you want to discuss something at more length. Oh, I also have a very thick skin, so if you disagree feel free to say so.

Enjoy what I write and let me know when I’m off base – I probably won’t agree with you but don’t be shy.

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