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

3. We can’t forget fitness
Apple CEO Tim Cook sits on NIKE, Inc. (NYSE:NKE)‘s board of directors, and he’s been photographed wearing a Nike+ FuelBand.

Beyond providing the time, the FuelBand has a sports-tested accelerometer to track calories burned, steps taken, and the proprietary NikeFuel metric that is synced up with smartphone apps via Bluetooth and can be used to partake in immersive goal-oriented games.

With all of that in mind, where does Apple raise the bar? It can’t simply slap a bracelet around an iPod nano and call it an iWatch. Apple can’t ignore the success of Nike’s FuelBand — and even cheaper FitBit and Jawbone trackers — as lifestyle bands.

Even if it incorporates Pebble’s functionality with FuelBand’s lifestyle features, it won’t be breaking new ground for too much longer. Until Cook resigns from Nike’s board given the conflict of interest, let’s assume that Apple’s not gunning for the fitness lifestyle market beyond possibly making Nike a default app. That can happen, but it may also limit Apple to Nike’s own shortcomings against rival devices that monitor sleep and perform daily diet planning.

4. The iWatch may not be a jack of all trades
The iWatch will probably be more iPod than iPhone, and that should lead folks to question the move in light of two years of declining iPod sales.

Why are sales of Apple’s media player sputtering? Well, the likely reason is that iPhones and even iPads do more.

There’s no denying that Apple’s watch will look great and integrate with its existing family of devices. However, unless it does a little bit of everything, it will be hard to justify slapping an iWatch on one’s wrist.

5. Apple will probably price itself out of the market
Pebble and Nike’s FuelBand retail for $150. Since the iWatch is unlikely to have 4G LTE connectivity — because who wants to pay $20 to $50 a month for access on a watch — there won’t be any wireless carrier subsidies to save Apple from having to sacrifice margins here.

Apple can take the high road and aim for a sliver of the market the way it did with Macs when PCs were selling, and it probably will. However, Apple will ultimately have to make a choice between high sales and high margins.

It won’t be able to score both, and that’s why the iWatch won’t change the world.

The article 5 Reasons Why Apple’s iWatch Will Fail originally appeared on Fool.com and is written by Rick Aristotle Munarriz.

Longtime Fool contributor Rick Aristotle Munarriz has no position in any stocks mentioned. The Motley Fool recommends Apple, Fossil, Google, and Nike. The Motley Fool owns shares of Apple, Fossil, Google, and Nike.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

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