Apple will probably release a smartwatch late this year or early next year — though the company will be in trouble if it comes out with anything resembling what's already on the market.
Apple could still revolutionize the product category, however.
Dawson says a game-changer smartwatch would serve "several other purposes" in addition to functions like sending push notifications and running apps you know and love.
One way Apple might transform the smartwatch is by making it a payment platform, Dawson said. He noted that smartwatches aren't doing this yet. Apple could gain a first-mover advantage here.
Adding identities to the iWatch like membership cards and even government IDs would also give it additional functionality. Dawson said a revolutionary smartwatch might replace the swipe card you use to get into your office.
Another way the iWatch could transform the market is by bringing it into the Internet of Things, in which all of your devices communicate with each other to make your life easier.
"A wearable device could serve as a location trigger for home automation functions, such as turning lights, air conditioning or a television on or off when someone enters a room," Dawson said.
Imagine a smartwatch that could sync up to your Wi-Fi and tell your Nest thermostat to adjust the temperature or stream your favorite show when you come home. Automating your daily life would allow the iWatch to become more than devices like Android Wear that act as a mere extension of your smartphone.
That said, Apple's smartwatch will almost certainly interact with the smartphone. Dawson said the iWatch could provide an additional layer of security for your phone, acting as a Bluetooth key of sorts.
"This will be a function of Android Wear devices, too," he said.
The iWatch could also act as a remote for other smart devices. The iPhone already does this for some devices, so the benefit to overall functionality is fairly limited in this use case.
There are clearly a no lack of functions Apple could incorporate into its upcoming wearable. Whether it does, however, will ultimately determine the success of the device and its effect on the company's bottom line.
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