Sources: Apple is working on adding cell-network connectivity, faster processor to its next-generation Watch
Apple's Watch Outpaced the iPhone in First Year — Despite sizable sales, Apple's latest product has challenges to overcome — Apple Inc. sold twice as many Watches as iPhones in each device's debut year.
Context & Ripple Effects
The Watch entered the market strong — its debut-year sales beat both the original iPhone and iPad — but it has remained tethered to the iPhone for calls and data. Earlier reporting had already sketched an untethered direction, including plans for FaceTime camera, iPhone-free Wi-Fi, and $1000+ models. This WSJ report pushes that arc further: cell-network connectivity plus a faster processor would make the Watch a standalone communicator rather than a companion screen.
The sourcing proved durable — a year later Bloomberg reported Apple planned a cellular Watch for 2017 with LTE modems supplied by Intel, and by 2019 the Watch was shipping 30.7M units annually, outselling the entire Swiss watch industry.
First-order effects
- Apple's next Watch could place calls and stream data without an iPhone nearby, directly loosening the product's biggest dependency and answering the performance complaints that come with its current chip.
- Carriers gain a new category of connected device to sell plans against, while existing Watch owners face an upgrade decision centered on connectivity rather than looks.
Second-order effects
- A modem slot in the Watch creates a new design win for baseband suppliers — a contest Intel ultimately won per the later LTE reporting — and gives carriers recurring revenue per wrist.
- Swiss watchmakers, already losing unit volume to Apple per the 2019 shipment data, face a rival whose product no longer needs an iPhone in the pocket, widening the gap from luxury accessory to utility.
Third-order effects
- If the pattern holds, the smartwatch completes its shift from iPhone accessory to independent computing platform — the endpoint visible in the coverage where Apple's wearable alone outships an entire national watch industry.
- Cellular independence in wearables pressures the broader device ecosystem toward per-device connectivity and subscriptions, with modem suppliers and carriers structuring around body-worn hardware as a distinct market.
The trend: The Apple Watch is evolving from a tethered iPhone companion into a standalone cellular device — a trajectory that carried it past the entire Swiss watch industry in annual shipments within four years.