What Apple Unveiled About the Watch Last Week

Apple (NASDAQ: AAPL) held its much-anticipated unveiling event last week, and announced several changes coming to its Watch line.

In this Industry Focus: Tech podcast segment, host Dylan Lewis and senior tech specialist Evan Niu explain what changes the Series 3 has in store, how Apple is improving its functionality, why the Watch's target demographic seems to be shifting and what this will mean for the line, its cost and availability, and more.

A full transcript follows the video.

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This video was recorded on Sept. 15, 2017.

Dylan Lewis: Why don't we first start talking about the Apple Watch, and what they decided to announce with that product line?

Evan Niu: Yeah, the Apple Watch Series 3. It's the new flagship. Really, the big addition here is LTE cellular connectivity directly integrated into the Watch itself as opposed to having to tether and rely on the connection of your iPhone. It gives it the potential to be a stand-alone device.

Lewis: And this is something that has been a major limitation of this device for quite some time. The idea of being able to go out for a run and receive calls or use Maps, you can stream Apple Music with the Series 3 as well if you decide to get the LTE option. I do think that builds out functionality in the use case for a lot of people. One device is only so helpful if you have to carry around two to really use it.

Niu: Right. I do think it has some potential. I think in practice, the whole tethering and reliance on the iPhone, which theoretically it does kind of hurt it as a stand-alone product, but I think in practice, it remains to be seen. Even on here, for example, I have an older Apple Watch right now and I've had to make phone calls on it occasionally if my phone is in the other room or something and my wife calls and I need to pick it up. And making a phone call on your Watch is really not a great experience. You can't hear them very well, they can't hear you very well, the mics aren't great. I'm sure the newer versions have better microphones and speakers. But just the experience itself isn't that great. And just because you could do that without your phone on the new version, I'm not sure that's going to be the game changing thing. It definitely helps in terms of increased functionality and increased independence, but I'm still waiting, I think it's too early to call on whether or not that's going to be the real thing that drives mainstream consumers to buy these things.

Lewis: One of the other things I saw them emphasizing quite a bit in the keynote was improvements to the wellness functionality of the device. They add the barometric altimeter, which is something that I think a lot of mountain bikers, runners, skiers, snowboarders will really appreciate. And you look at some of the Watch OS 4 updates that are going to be coming in mid-September, they redesigned their workout app, they provided some updates for swimmers, they made some changes to the heart rate monitoring and giving people some more advanced heart rate in metrics. I see all these things and it's like, they're making it pretty clear that this is a health and wellness device, in addition to being a cool consumer tech device.

Niu: Right. They're definitely betting really big on the health side. I think it's really interesting -- Tim Cook did an interview recently on this -- they invest in a lot of things on the health side that don't really need to be commercialized into the business, which I think is an interesting angle to take and also kind of an advantage, because since they can afford to invest in all these other partnerships with medical researchers, and the medical community at large, they can really expand their presence, and use that data to improve the Apple Watch, even if they're not monetizing those partnerships directly because obviously, Apple is so rich, they don't really need to. But, they just feel like they can do a lot of good for society if they can really advance this field, which I think is something that other smartwatch makers both don't really care as much about and also can't afford to do.

Lewis: And to that point, we did that show on wearables a couple of weeks ago, and we put out a call to listeners and said, "We talked about use cases here, and you and I are not particularly sold on the wearables environment in general, we don't really have use cases that make sense for us, but please write in if you have some that are super compelling for you and make it a must-have product," and a lot of people wrote in on health and wellness type stuff -- monitoring for very specific conditions, or things that force them to get in a little bit better shape. So, clearly it works for some people, and people with particular illnesses it can be particularly great for. So, it makes sense that Apple is moving that way.

Niu: And to build on that, I think it's important because, while the number of people that really take advantage of some of these more niche features, they might be a very small number of people, but for them, these features matter a lot. They can have really huge improvements on their life, even if they're a relatively small portion of the overall consumer base. But for them, these things are potentially game-changing to a small number of people, but huge impact.

Lewis: And looking at some of the details for the product for the Series 3, the Series 3 with cellular is going to be at $399. The Series 3 without cellular is going to be coming in at $329. They are available for order on 9/15, and actually available on the 22nd.

Dylan Lewis owns shares of Apple. Evan Niu, CFA owns shares of Apple. The Motley Fool owns shares of and recommends Apple. The Motley Fool has a disclosure policy.