Apple iWatch Set To Rock Smart Watch Market

Could an Apple iWatch revolutionize smart watches the way the iPhone revolutionized smartphones? Morgan Stanley is betting the answer is yes.

Industry watchers expect the iWatch to make its way to the market later this year and Morgan Stanley analysts are already analyzing its potential success. In a Monday report, the firm boiled down its success to brand loyalty.

"In our view, Apple will introduce a device with more sensors, and better form factor and aesthetics than competing devices in the market priced at $100-250," Morgan Stanley writes in its note. Against that backdrop, the firm expects Apple to sell the iWatch for $300, which would equate to at least a 40 percent profit margin.

Would You Buy One?

Morgan StanleyEUs Katy Huberty made a bold prediction in the research note: Apple will sell between 30 million and 60 million iWatches in the first 12 months. She bases that prediction on EUhistorical penetration of past iDevice[s].EU

Is this a plausible prediction? Consider a recent survey from Piper Jaffray that asked 10 people about watches and wearables. That survey reveals 14 percent would buy a $350 smart watch from Apple. Piper concluded that a $200 iWatch would be even more appealing.

Ultimately, 41 percent of those surveyed said they wouldnEUt buy an Apple smart watch no matter how little it costs. More than 30 percent said they would invest in an iWatch if it cost $100 to $200. Morgan Stanley is predicting that the $300 price tag may not bode well for Apple. Then again, Apple has always pushed out premium products and typically sees strong demand.

Anything Is Possible

We caught up with Roger Entner, principal analyst at Recon Analytics, to get his thoughts on AppleEUs chances to sell massive numbers of iWatches at a high price point. He told us if the iWatch is as...

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