TidBITS asked
recently how much gold Apple's new smartwatch would be likely to consume.
Based on the estimated production figure of 1 million units per month, each
containing 2oz of 18-carat gold, it sensationally claimed that Apple would
require 24 million ounces of gold annually, or roughly 30 percent of world
production.
Gold bugs could be excused for yelping with excitement! But what seems too
good to be true has a habit of turning out that way.
On Monday Apple announced the gold watch would cost US$10,000. Huffington Post sounded a word of warning, calling it
"extremely expensive for something that could be obsolete in the
next year". Bloomberg was already on record with a sceptical
opinion piece entitled "Apple Watch Won't Rescue Gold Bugs".
According to Alix Steel, much could depend on whether the watch is
seen as a piece of electronics or jewellery. With demand for gold in
technology currently languishing, it has a much better chance of succeeding
as jewellery in key markets like China where young people "eat up
18-carat gold items", she suggested.
What might also prove troubling about the perception of the gold watch
stems from Apple's announcement that its new product is crafted from 18-carat
gold that is twice as hard as "standard gold."
Understanding this involves a fair amount of advanced metallurgy, but
basically instead of alloying gold with other metals such as copper or silver
to make it tougher, Apple is mixing its gold with low-density boron carbide
ceramic particles. According to Dr Drang, writing on Leancrew,
it "allows them to make 18-carat gold that has, on a volume basis,
less gold than regular 18-carat gold."
As the chart shows, this reduces the amount of gold Apple needs to use per
watch significantly.
It'll be interesting to see whether consumers think it's
cheeky to call the watch 18-carat when it has less pure gold in it than
traditional 18-carat of the same volume. And even if they do, will it prevent
the company from reaching its ambitious-sounding sales targets? We're certainly
not prepared to bet against Apple's supreme marketing skills or the loyalty
of its customers!
