Google, Intel, and Tag Heuer are uniting in a mighty alliance to push Android Wear dramatically upmarket with a new smart timepiece from the Swiss watchmaker. Its price hasn't yet been announced, but it's safe to assume it will be the most expensive Android Wear watch to date, going beyond the merely fashionable and entering the luxury stratosphere. To find any success as a connected smartwatch in that price range — as opposed to just another complication-rich Tag Heuer — this Android Wear device will have to learn a new trick: iPhone compatibility.

Apple's iOS and Google's Android are relatively balanced in their share of smartphone users, but there's a substantive difference in the type of users they attract. Specifically, iPhone owners are richer and spend more than their Android counterparts. It's an uncomfortable truth, backed up by the two companies' own numbers and serially reiterated by market research data. Take as an example these tweet maps from the US, showing Android leading in poorer regions and iOS prevalent in higher-income areas.

This is not to suggest than an Android smartphone is the proverbial poor man's iPhone. But the economic reality of the competition between them is that iPhone owners have more disposable income and are more willing to spend it. Those are the first preconditions to finding a receptive audience to luxury goods — and a luxury good is exactly what the Tag Heuer Android Wear watch promises to be. The watch clashes with its stated purpose by introducing its own precondition: you won't be able to even boot it up without first connecting an Android device. Without Android, this Tag Heuer watch will be an expensive, probably splendid-looking paperweight.

Once hooked up to an Android phone, this will be Tag Heuer's first smartwatch. But unlike any other product that the company has sold so far, its potential audience will be limited not just by its high price but also by the exclusivity of its software. Who, outside of the few dozen Vertu owners out there, is running around with a luxury Android smartphone to pair up with their new Tag Heuer timepiece?

LG can't sell a $300 Android Wear watch. Will Tag Heuer's reputation help it do better?

So long as it keeps itself locked in to the Android ecosystem, the Tag Heuer watch will face a low ceiling of popularity. Tag Heuer fans will surely be interested, because it extends the prestigious brand's heritage with a new model, but the vast swathe of wealthy iPhone owners will shrug their shoulders and check their calendars for the Apple Watch release date.

Google's hardware partners are having enough trouble selling Android Wear watches as it is. LG, for example, is literally giving away the G Watch R to people who buy its new G Flex 2 smartphone with Vodafone in the UK. The surest sign that a company can't sell something is when it starts giving it away for free. Escalating the price and the prestige of manufacturer is an interesting approach, but it won't work if it's handicapped by the requirement of an Android phone. We've already seen one developer making the combination of iPhone and Android Wear work together, and at this point, the reasons why Google hasn't issued an Android Wear app for iOS probably have more to do with inter-company politics than major technical limitations.

The TAG/Intel/Google (Android Wear) partnership all but tells us Android Wear will be iOS compatable. Likely announced at I/O. — Ben Bajarin (@BenBajarin) March 19, 2015

Tag Heuer is unlikely to be the sole luxury partner for Google's venture into high-end watches. Luxury brands are showing themselves desperate to appeal to a younger clientele — including Gucci, who today announced a partnership with will.i.am for a smart wristband that can make phone calls — and technology is seen as the key to making that connection. As the number of luxury Android Wear watch brands expands, the issue of locking out the well-off iPhone audience is only going to grow in importance. That's why industry analysts are already predicting that Google won't keep that artificial barrier up for much longer. There are suggestions that iPhone compatibility will be announced at Google I/O this summer, by which time other high-end brands are likely to have added their name to a growing Android Wear luxury lineup.

The iPhone is the key to unlocking the luxury smartwatch market, both for the Apple Watch and Android Wear

There remains much dubiety about the value of smartwatches in general, whatever software they happen to use or brand they happen to represent. Apple's Watch has left people unconvinced after two major events showing off its key features, and Apple is pursuing a similar strategy to Google in limiting its new device to working only with its own iPhone. Still, because of Apple's higher prestige and wealthier client base, that's a gambit that the Cupertino company can make.

By partnering with esteemed watchmakers like Tag Heuer, Google is eroding Apple's advantage as a recognized luxury brand, but in order to compete on a truly even playing field, it'll have to play nice with the iPhone as well. The key to accessing the higher strata of luxury smartwatches will be the iPhone. That's as true for the Apple Watch as it will be for Tag Heuer's Android Wear watch.