Bold prediction- I don’t think the Watch is going to be on an annual refresh cycle.
This is one of those “lessons learned” from the iPad. A premium-priced device that’s essentially an accessory has a very hard time selling up a lot of units year-over-year. The iPhone is an anomaly that’s driven by contracts and subsidies. The iPad has followed more closely to the Mac in terms of upgrade cycles. And I think the Watch has the same roadmap.
Apple’s mistake with the iPad was putting it on an annual refresh cycle that gave analysts a reason to judge it’s year-over-year performance on-par with iPhones. That’s a bad measuring stick for the Watch. Like the iPad, it’s much more expensive to consumers and thus the ability to buy a new one each year is much lower. Additionally, I think the limited functions of the Watch will mean that older models will be “good enough” for much longer.
Apple would be smart to not set expectations for the Watch’s hardware on an annual cycle. Software, fine, but limit the hardware releases to perhaps every-other year. Give owners more time enjoy the current model and thus more time to feel “old” about it when the next one comes along.
Additionally, given how difficult and large the production requirements for this product are, I have to think you need more time between re-toolings to get your profitability back out. And something tells me there won’t be much down-market demand for “last-year’s” Watch to make up the margins the way there is in phones.
In the meantime, a stream of new bands each year would keep the product feeling fresh and make great profits for Apple.
Bottom line, I won’t be surprised if we don’t hear about the Watch again until next fall. But that’s just my opinion...