Apple team 'developing wristwatch computer'

Company needs breakthrough product to counter sluggish sales and competition

PUBLISHED : Thursday, 14 February, 2013, 12:00am
UPDATED : Thursday, 14 February, 2013, 4:53am

Apple has a team of about 100 product designers working on a wristwatch-like device that may perform some of the tasks now handled by the iPhone and iPad, two people familiar with the company's plans said.

The team, which had grown in the past year, included managers, members of the marketing group as well as software and hardware engineers who previously worked on the iPhone and iPad, said the people, who asked not to be named because the plans are private. The team's size suggested Apple was beyond the experimentation phase in its development, they said.

Chief executive Tim Cook is facing pressure from shareholders who have seen the stock slump more than 30 per cent since a September high amid slowing sales growth and competition from rivals such as Samsung Electronics. Without a revolutionary new gadget that commands a higher price, investors are concerned about falling margins and increased competition.

"The iWatch will fill a gaping hole in the Apple ecosystem," Bruce Tognazzini, a technology consultant and former Apple employee, wrote in a blog post last week. "Like other breakthrough Apple products, its value will be underestimated at launch, then grow to have a profound impact on our lives and Apple's fortunes."

Natalie Kerris, a spokeswoman for Apple, declined to comment. Previously, The New York Times reported Apple was working on a watch-like device.

Apple's James Foster, senior director of engineering, and Achim Pantfoerder, another manager, are part of the efforts to introduce a wristwatch-style computer, according to the people. The company had worked on wearable devices for tracking fitness in the past and never brought them to market, one of the people said.

Creating a watch involves unique challenges, particularly managing power demands so that the battery does not need to be recharged every day. Google has been working on eyeglass-embedded computers and plans to introduce them next year.

The introduction of a wearable computing device may signal a new direction for the consumer-electronics industry. Apple's debut of the iPhone in 2007 and iPad in 2010 created the market for touch-screen smartphones and tablet computers that have been followed by firms such as Google and Samsung.

Apple was right to invest in products such as watches, even if they did not result in commercial products, said Josh Spencer, a fund manager at TRowe Price Group. "There's more people that would wear an Apple watch than would wear Google glasses."

Wearable machines for tracking fitness are already on the market from Nike, Fitbit and other manufacturers.

Hon Hai Precision Industry in 2001 invested in start-up WIMM Labs, which designed a watch with a screen, Wi-fi and Bluetooth.