5 Reasons Why Apple Inc. (AAPL)’s iWatch Will Fail: Fossil, Inc. (FOSL), NIKE, Inc. (NKE)

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Sources are getting chatty again, telling The Wall Street Journal and The New York Times over the weekend that Apple Inc. (NASDAQ:AAPL) is working on a high-tech watch.

This isn’t the first time that we’re hearing about a smart watch out of the class act of Cupertino. The iWatch buzz has been bubbling for months. This doesn’t mean that we’re getting one. Apple’s name has been tied to high-def TVs, phablets, and cars in recent months. Even if Apple Inc. (NASDAQ:AAPL) is actually testing watch designs, it doesn’t mean that a device will actually see the light of day.

Fossil Inc (NASDAQ:FOSL)However, let’s assume that the iWatch is coming. The notion that anything that Apple does will magically turn into consumer tech gold will be challenged. Let’s go over a few of the reasons why Apple Inc. (NASDAQ:AAPL)’s potential timekeeper may not be much of a keeper.

1. Watches are a hard sell for tech-savvy consumers
Stroll through the halls of a high school or a college campus and you just don’t see wristwatches these days. Who needs a one-dimensional watch when smartphones or even fitness bands can tell the time?

This doesn’t mean that watches are dinosaurs. They remain popular as fashion statements for adults. The Swiss watch industry posted record exports last year, and fashion-forward players are doing well closer to home. Fossil, Inc. (NASDAQ:FOSL) may have been downgraded by a Benchmark analyst this morning, but the Texas-based maker of stylish timepieces is still expected to grow its sales by 11% this year after a similar spurt through 2012.

However, it still makes this a difficult market to crack when potential buyers will wondering if they really even need a watch these days.

2. Apple may not be the ideal disruptor
A sleepy watch market isn’t enough to shoot down Apple Inc. (NASDAQ:AAPL)’s chances, bulls will rightfully argue. Apple rolled out the iPod in 2001 when the Walkman craze had come and gone. The iPhone in 2007 transformed smartphones that were largely popular at the corporate level into a consumer craze.

Apple didn’t have a lot of competition as it forged new ground, but that won’t be the case with Web-savvy watches.

Pebble raised more than $10 million on Kickstarter last year for its customizable watch that uses Bluetooth to alert Android and iPhone owners about incoming calls, emails, and text messages.

On a larger scale, why will Apple Inc. (NASDAQ:AAPL) fare any better than Google Inc (NASDAQ:GOOG)?

As Apple-watching blogs chat about the tech giant possibly introducing a smart watch or even a car, Google already has wearable computing products and self-driving cars out in the wild. Sure, Google has no plans of selling its Web-tethered goggles or its street mapping automobiles, but it’s already extending its brand by showing the public that Big G makes these things possible.

The moment that Apple Inc. (NASDAQ:AAPL) breaks out its wrist hugger there will probably be smarter competition than it has faced in earlier introductions.

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