Be Afraid, be very afraid: Why smart watches will decimate the Swiss watch industry

Most watch enthusiasts are aware of the quartz crisis, a dark period of the 70's when quartz watches became commonplace and affordable. The Swiss have never truly recovered, with far fewer brands now than during the 1960's. I foresee that a similar cataclysmic event is on the horizon, at least for most brands (I'll just say, below the market placement of Longines)


Fast forward to 2014 and a new threat is emerging: smart watches. I will admit right off the bat that the likes of Rolex and Patek will survive, as they did the 70's, but many, if not most brands will fade into obscurity. The counterarguments against smart watches are the usual: smart watches will never replace the richness of "real" watches, mechanical watches retain value while smart watches only depreciate, smart watches are nerdy and won't appeal to the masses, smart watches aren't status symbols like real watches. And a favorite, sales have gone up since fitness bracelets have gone mainstream. These notions are wrong.

Functionality: standard, status symbol: optional.

It is true that the current breed of smart watches are a bit geeky and clunky, but the development of thinner and better technology will allow them to be integrated into more fashion conscious designs. While Switzerland refuses to help Apple and Samsung on their quest to make the perfect smart watch, fashion brands won't be so hesitant. Tory Burch is already working with Fitbit.

Tory Burch accessory for Fitbit Flex

Smart watches will depreciate, like any electronic device. Fine mechanical watches, on the other hand, tend to appreciate slightly. However we must recognize that the majority of the market is not for fine mechanical watches but rather watches with either quartz (Swiss or otherwise) or ETA/Seiko mechanical movements. These watches are not much better retainers of value than the average apple product.

Fitness bracelets are also invariably different than smart watches, they usually don't show the time and can be worn on the dominant (usually right) wrist without being too obtrusive. However, smart watches, especially if they are to pack more features and fine details, will be larger and more suited to replacing the place of traditional dumb watches. Most of us only have 2 wrists after all, and very few of us wears one watch on each wrist. I'm just not comfortable claiming that smart watches will reignite people's interest about watches. The smart and dumb watch are competitors but very distinct products. 

There can be only one (I'd prefer the moto in this case...)

Of course, I'm not Nostradamus and it is possible that the march of dumb watches will go on, but I'm not too convinced. Mechanical watches will probably always exist, just as cast iron skillets, film Leicas, and vinyl records, but the decimation is neigh.

Beautiful, not dead, irrelevant.