Baselworld: Swiss elite shrug off Apple smart watch challenge
Browsing the 141,000 square meters of stalls in Baselworld this year it's hard to make out whether the industry is one step ahead or behind.
Barely a week before the event kicked off, Apple captured world attention by unveiling its eagerly anticipated timepiece, stealing the 90-year old fair's thunder somewhat.
Ask the chief executives present what they make of the challenge and some shrug apathetically while others become animated about the "opportunities" it creates. Everyone's strategy seems to be different.
"It's a fight for the wrist," says 38 year-old Edouard Meylan, CEO of family owned H. Moser & Cie.
"How smart watches will affect Swiss watchmakers remains to be seen but you can't ignore the trend."
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Moser, a 55 strong firm, making just 1,000 watches a year spooked rivals by announcing it would soon create a smart watch of its own.
The resulting product "Funky Blue" was anything but digital.
However in a joking nod to today's new technology, the firm branded it the ultimate "smart" watch, extolling its virtues of not needing to be charged after 18 hours like Apple's and an interface so simple "our grandmother could use it."
The message: the mechanics of Swiss watches, a craft honed over three centuries, are already so advanced they don't need to play second fiddle to anyone.
Among those expressing stronger reservations: Karl-Friedrich Scheufele, co-president of Chopard.
"When it comes to a higher end watch, I really, strongly believe in mechanical movements and the beauty of these movements is that they last for generations and you don't have to worry about batteries and recharging," says Scheufele.
Return of the wrist watch
But Scheufele also concedes that in the long-run if Apple's watch encourages the younger generation to wear a wristwatch at all -- rather than check the time on their phones -- that is a good thing for watchmakers worldwide.
"This could feed a chain of aspiration. So somebody who has made some money would like to spend some money on themselves (...) they might graduate to a Chopard watch or Chopard piece of jewelery," he adds.
While the technology behind smart watches might be new, this isn't the first time Switzerland's watch industry has had to adapt to innovation from abroad.
Back in the 1970s the advent of affordable Japanese quartz shaved millions off of their sales.
When it comes to a higher end watch, I really, strongly believe in mechanical movements and the beauty of these movements is that they last for generations.
For a few years the sector seemed doomed, only to discover its focus on tradition, quality and durability would become prized attributes by the fickle consumer as he or she matured.
Priced at between $349 and up to $17,000 dollars, Apple's latest gadget is likely to affect Swiss watches differently depending on which end of the price spectrum they inhabit.
The product will also be aiming at a younger target audience.
For this reason its impact is likely to be felt most keenly among the lower-priced, higher volume watch makers like Swatch and Tag Heuer, both of which are developing their own rival watches which in typical Swiss fashion they prefer to call something unique -- in this case "connected" rather than "smart".
However, taking on a brand like Apple on its own digital home turf is not for the faint-hearted.
What's more, such a strategy risks diluting a brand's unique Swiss-made appeal, for much of the know how will have to be outsourced to other nations like the United States and Asia.
The challenge also comes at a particularly unwelcome time for Switzerland's watchmakers after their central bank abandoned its peg to the euro, sending the Franc shooting up and increasing the price of Swiss watches particularly for Eurozone customers.
Smart watch technology -- even in Apple's new watch -- is still in its relative infancy and advances will be made from here on.
Citigroup reckons the market for such products could be worth some $10 billion by 2018.
Watchmakers like Tag and Breitling, which are part of big listed firms like LVMH and Swatch Group, can't afford to seem apathetic in the race to grab a share of sales like that.
For Baselworld's smaller, niche players though, Apple's watch is the hare to the Swiss watch's tortoise -- and we all know who won that race at the end of the day.