Thoughts on Modularity

During the Keynote there was no mention about the possibility of upgrading the Apple Watch and the topic is getting really interesting because this intersection between performance and obsolescence is something technology might has a hard time dealing with.

When it comes technology, rules are clear, you know where you are getting into: early obsolescence, more memory at cheaper prices and faster processors every other year… But when it comes to fashion and jewelry, other rules apply. A $20.000 Rolex is meant to be handed off to your son, you are paying for perpetuity in some extent. But when you add technology in the equation, the perpetuity is fundamentally constrained by Moore’s Law.

Before the Apple Watch was announced there was some speculation around upgradability and even programs where you traded-in the old device to repurchase a newer model. But during the Keynote, there wasn’t official word of this. It’s also true that afterwards there were some articles that claimed the battery could be replaceable, but that’s all.

My thoughts about upgradability have been evolving and bouncing from one side to another these past weeks. That's what I wanted to lay out some facts that might help better understand this issue.

I’ve always thought of upgradability as a fundamental piece of the technology lifecycle. Initiatives like Project Ara made me believe that there was actually possible to build a sustainable business out of modular technology. It makes so much sense. Of course they still have to prove everything, but they are clearly exploring an interesting path.

The goal of upgradability is to extend the lifecycle of a certain device, so at the end, we produce less waste. We do this by replacing components for newer ones as technology evolves, maintaining (at least for a longer period of time) the basic structure that supports those components.

When the Apple Watch was announced in September the rumors about its upgradability started to pop up, it made sense. But when you think of Apple and upgradability, the trend is clear: none of the newer Apple devices are upgradable, and the ones that once were upgradable (like the iMac or the MacBook) are not anymore.

 Initiatives like Project Ara made me believe that there was actually possible to build a sustainable business out of modular technology.

Initiatives like Project Ara made me believe that there was actually possible to build a sustainable business out of modular technology.

So, why the Apple Watch was going to be different? I don’t have the answer to that, but there were two reasons that fueled this argument:

  1. The S1 SoC seemed to be specially designed to be swapped as a bundle, making it easier to replace all the components with an easy operation.
  2. The jewelry approach, because watches are meant to endure, if the Apple Watch was obsolete in 3 years, nobody would want one.

First, I understand the S1 argument and it makes sense. But imagine you bought the Original iPhone in 2007 and today you walk into an Apple Store to join the "Upgradability Program". See where I’m going? There is such a fundamental misalignment between how the original iPhone and the current iPhone 6 were conceived. The iPhone was meant to be a complement of the Mac, now it’s the center piece of our digital life.

It’s not just about upgrading the processor, the RAM, the antenas… there’s a lot more than just “specs” to upgrade. But some might say “The S1!”, yes, it’s a closed structure that could be easily replaced, but 1) maybe it was designed this way to perform under the water, who knows. And 2) this is the first iteration of a product that might do a lot more in just three years, the same that happened with the iPhone will happen with the Apple Watch, and these fundamental design changes driven by technology can’t be planned ahead.

The other argument is the jewelry thing. This was the one that kept my hopes of upgradability alive, but I recently had (again) mixed thoughts about it. Imagine Apple would had only released the Sport Edition. It'd be called the Apple Watch, aluminium case, rubber band… $349 and you are good to go. If that were the case, would we even be discussing the upgradability thing? I don’t think so. What’d be the difference then between an iPhone and an Apple Watch? Both are a pieces of technology we use in a particular way. We don’t think differently because an iMac is sitting in a desk and an iPhone is resting in my pocket. So why make the distinction between pocket and wrist? At the end of the day when the battery dies or it feels “slow” you go and buy another one. End of the discussion.

But here it goes the gold. Is not the idea of a watch that makes you think of upgradability, is the idea of a luxury watch as a perpetual piece. The conflicting point is how to argue the sell of a device that cost the same, but will be obsolete in five years, while the other is perpetual. So the problem is not that this is a watch, the problem is that there are watches in the market that cost a lot money and their "strong suit" is that they are perpetual.

 Durability vs. Performance. A Rolex might be more durable, but it doesn't offer the same amount of functionality as an Apple Watch does.

Durability vs. Performance. A Rolex might be more durable, but it doesn't offer the same amount of functionality as an Apple Watch does.

This is the fundamental wrong assumption. We are comparing those devices in an obsolescence / durability basis and we are missing the bigger picture. Yes, when you buy a Rolex maybe you expect durability to be the main feature, but when you buy an Apple Watch you are getting a lot of other features you won't get with a mechanical watch. So we also have to bake this into the price. The short story is that the Apple Watch might not be competing “directly” against luxury watches. It’s a whole other category.

We can't weigh all the Apple Watch value on a time-aging basis because it is doing a complete different job that an mechanical watch does. It would be like blaming a mechanical watch for never getting updates and doing always the same over time. Let's see if a couple of examples help in here.

  1. There's a huge market for $1.000 bags that might be used three times in a life time. Some people buy them, not on a rational basis, but driven by some trend that the Apple Watch is also trying to exploit in another direction.
  2. Also some people pay $25.000 for a transoceanic flight that lasts fifteen hours or less and yet these people are willing to pay for that. Some people get into the same flight, same destination, same amount of time, but at a fraction of the cost. Are those who pay $25K stupid? I don't think so. But no one is complaining about not getting before to the place becasue they've paid more. I mean, saying is cheap or expensive (only) comparing it with a traditional mechanical watch is wrong and also not fair.

I would never buy a gold watch, nor Apple or Rolex, but I can see a lot of people that would want one. Is this a huge market? I don't think it is, but maybe the point of selling this watch is more of a line to separate even more from Samsung and co. No one has the answer of how well is going to sell, but it is clearly an interesting move and the first great attempt to overlap fashion and technology in ways that have never been done before.