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Apple Inc. Watch Shows 'Innovation Is Back'


Analysts are full of praise for Apple's (NASDAQ: AAPL) new product lineup.

Global Equities Research analyst Trip Chowdhry -- a staunch Apple critic -- was quite pleased with the company's presentation.

"I think that first and foremost, innovation is back at Apple after three years of pause," Chowdhry told Benzinga. "Second, Apple Watch is groundbreaking."

Chowdhry said the Apple Watch "pretty much [sends] Android Wear back to the drawing board."

TechStrat Report author Sean Udall was also impressed with Apple's first smartwatch, but he thinks the new iPhones are a much bigger story.

"To me, the far more important thing is that they did indeed bring two large-screen phones," said Udall, who also serves as the CIO of Quantum Trading Strategies. "That is the most important thing because they had to bring two phones, they had to be compelling. I think Android now has a much, much tougher hill to climb on the phone front."

Udall accurately predicted Apple would use sapphire in its watches but not in the iPhone 6 and iPhone 6 Plus. He also successfully predicted the latter model would retail for $100 more than the 4.7-inch iteration. He believed that Apple would maintain the company's traditional (contract) starting price of $199 for the smaller model.

"Samsung is in near-term trouble, at least in their phone business," Udall added.

Related Link: Brian Sozzi Explains Why Best Buy Is 'Apple's Biggest Fan'

Feature-Packed Device

IHS Associate Director Shane Walker was initially disappointed by the Apple Watch's design. He was ultimately won over by the device's functionality.

"From what we've seen, it's definitely the most interesting smartwatch to date," Walker told Benzinga. "That doesn't mean it's the most revolutionary, but they have done a good job of integrating a great deal of technology into a small space with an interest in user interface."

Walker thinks the Apple Watch will improve the industry's popularity.

"It's going to be a compelling product," he added. "I think it's definitely going to be the product that moves the smartwatch industry forward in terms of sales and shipments."

Related Link: Everything You Need To Know Before Apple Inc.'s Big iPhone 6 Event

Branding Is Everything

Mary Beth Keelty, Vice President of Marketing at PM Digital (a full-service marketing agency) and Paradysz, told Benzinga Apple has "a lot to prove" with its first wearable device.

"Wearables are not a new concept," said Keelty. "Many have tried and few have truly succeeded. But Apple -- with its emotional foundation with consumers -- has a chance at convincing users to wear technology."

Keelty noted that Apple CEO Tim Cook persuaded former Burberry CEO Angela Ahrendts to leave high-fashion for high-tech.

"The move hinted that Apple knew a fashion aesthetic perspective would be necessary to propel the brand into the wearable era," Keelty explained. "While price will certainly play a factor regarding initial iWatch sales, an iWatch designed with consumer wants in mind -- sleek, adaptable, slightly obscure -- has a chance at facilitating a wearable movement."

An iPod Nano In Disguise?

Not all analysts were impressed with the product Apple introduced this week.

"[The Apple Watch is] basically an iPod Nano with a strap," Enderle Group Principal Analyst Rob Enderle told Benzinga. "And we knew a couple years ago that there was a market for iPod Nanos with straps. People were wearing them a lot. Then they changed the design and you couldn't use them with straps anymore! Folks were disappointed."

Enderle expects the Apple Watch to "live or die" on its apps.

"That's probably a different factor than you would typically see with a wearable device," he said. "Wearable devices tend to be fashion first, utility second. Apple has delivered a product that is utility first, fashion second."

Enderle isn't sure Apple made the right decision.

"I wonder whether they're on the right track with this," he added. "Apple loyalists will pretty much buy anything Apple. That's not the issue. [But] I'm not convinced an iPod with a strap is going to be the defining design for a wearable device, at least not yet."

Disclosure: At the time of this writing, Louis Bedigian had no position in the equities mentioned in this report.


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