What connects the Apple Watch, Eric Schmidt and lean startup management

Cassandra, purveyor of good news in the Greek mythology

In the past few weeks, high tech experts and well established analysts have abundantly demonstrated why the recently announced Apple Watch will fail : Techradar, Business Insider, CNN, even Mac Life. They’re mostly wrong.

Beyond the journalistic temptation to write click baiting articles, human nature is more inclined to announce failure rather than success. But predictions are tricky.

Instead of discussing individually why most arguments in these papers are flawed or pointless, I prefer to prove my point with facts, since History is probably the best teacher :

Don’t believe the experts

I have covered before the gap between media excitement & analysts reaction prior to a product release, compared to its actual market performance.

The very first iPhone was highly anticipated, but market reception and long term impact were beyond what any analyst prophesied.

In 2006, Bill Ray from the Register, wrote that “the iPhone would fail, and fail badly”.

Bad guess, Bill, but you were not the only one. Advertising Age agreed, and Matthew Lynn from Bloomberg summed up the overall skepticism :

“The iPhone is nothing more than a luxury bauble that will appeal to a few gadget freaks. In terms of its impact on the industry, the iPhone is less relevant.”

Quite a misjudgement for a tech analyst from Bloomberg, but wait — Steve Ballmer, nothing less than Microsoft CEO, just laughed out loud about the possible performance of “a $500 phone with no keyboard”.

To his credit, you have to remember that BlackBerries were all the rage back in 2006.

Of course, it is easy to disregard Microsoft opinion today, since they have a built a pretty good track record of struggling with new products of their own : Zune, Kin (you probably never heard of it), Surface, Windows Phones.

So how about the point of view from a fresher, more successful tech company, like Google, and former CEO Eric Schmidt ? Him, of all people, should know about B2C technology.

When asked about tablets in January 2010 — not so long ago -, here is what he had to say :

“Tell me the difference between a large phone and a tablet”

I don’t blame him, I thought the same thing.

Well, Eric, we were both wrong :

5 years and 600 millions tablets sold later, it looks like the rest of the world estimated the difference to be worth roughly $40 billion per year. Tablets have become the fastest growing segment in the tech industry, rapidly cannibalising laptops. Unpredictible world…

This type of reaction sounds very akin to CNN David Goldman’s criticism of the Apple Watch that

“just allows you to do some iPhone functions on your wrist”.

Sorry Dave, Eric Schmidt and myself have been down this road before : not the right way to look at things.

First reason why it is so difficult to assess new product success, is because a product just does not sum up to features and a spec sheet.

Indeed, an iPad is nothing more than a large phone.

But after just a few minutes with the device in hand, you quickly realise why it took over the world : it is easy to use, lightweight, comfortable, fast, well designed, clutter free, and for the first time, it brings the entire Internet ecosystem and content from your desk to your couch — and to the hands of your grandma, as well as airplane pilots, warehouse managers, or Daft Punk.

And for all this to happen, it had to be just a bigger phone.

Devil and the details.

Lemur Live Control, used by Daft Punk to make music. But remember, an iPad is just a bigger phone

Execution is paramount

Remember the Archos Jukebox ? Does the Creative Nomad ring a bell ?

Both were the original creators behind the exact same concept as the iPod (portable music player, hard drive based) and were released respectively two years and one year before the first iPod.

Overall, since product inception, Archos and Creative sold a few hundred thousand units, while Apple moved roughly 360 millions iPods.

Still think they don’t stand a chance with smart watches because Samsung, LG and Motorola failed with four or five consecutive attempts ?

Usage and Attitudes

Tech has silently conquered all areas of our lives, is used increasingly, and in always new ways. Find an address on a map, carry flight boarding pass or concert tickets, contact anybody, anytime, check your bank account, order a cab, find sex partners around you, rent out lodging, track your workout program, post pictures of your food, pay your meal, open your door lock… None of this was something people even thought they would do with their phone 10 years ago. Now it’s everywhere, everyday, and there is no way back.

So wearing a watch that offers the potential to join this ecosystem, with just the extra convenience of being smaller, lighter, almost invisible, closer to you ? Don’t ditch the idea too fast.

A smartwatch looks terrible on people’s wrists, says Business Insider ? Well, BI, you wrote the same thing about large phones (just like Forbes, Steve Jobs and many others) - and just a few years later, it looks like everyone eventually got used to it.

Third reason : the next big thing very often looks pointless at first.

Remember the first days of Wikipedia, when it was harshly criticised for its countless errors, when teachers and experts advised you not to use it ? — until it officially became the most trusted, consulted and updated world source information.

Facebook started as a college website used to share pictures of sophomore parties. Now Louis Vuitton uses it.

Experts kept deriding the iPhone for its incompatibility with Flash (sounds funny today), excessive price, and lack of keyboard. It became the standard every smartphone manufacturer tries to copy.

Eric Schmidt (again…) called Twitter “poor man’s email” — and yet Google+, packed with all its great features, never took off.

Billion dollar potential.

Who could have guessed Twitter would be even remotely successful ? Or Candy Crush ?

Who could have ever believed that an app as stupid as sending ‘Yo’ messages to your contacts would not only be massively used, but could be considered a “notification platform” potentially worth $1b ?

I wouldn’t — and for the latter, I still don’t.

So Apple Watch poor battery life ? Sure it’s bad. Dealbreaker ? Not sure.

Conclusion : there is a weird alchemy in tech product adoption, that is never completely understood, mastered, or definitely acquired.

Just ask BlackBerry, Microsoft or Samsung.

This could happen to Apple too, but not before several years, and for none of the reasons I read in any of CNN / Bloomberg / Techradar prophetic papers.

This is also why, after the sovereignty of market research in meeting rooms, and AC Nielsen driven product decisions, the latest trendy mantra is lean startup management and MVP (minimum viable product)— even for big companies.

Agile principles commend to try and fail fast : since product traction is so difficult to conceptualise and anticipate, let’s just try out and multiply attempts as fast as possible with iteration loops — Not the best attitude either, I will write about that later.