In March the co-inventor of Swatch said that the Apple Watch would force Switzerland's watch industry into an ice age. Then in May Swatch announced that they would launch their first smartwatch later in the year called the Touch Zero One. In Europe today, pioneering Swiss watchmaker Swatch announced a new kind of analog watch that will be coming to China in 2016 called the Swatch Bellamy. Its unique feature will be to offer users a mobile payment solution they call pay-by-the-wrist.
Swatch officially presented the new watch at the landmark Swatch Art Peace Hotel in Shanghai today. Swatch has joined forces with China UnionPay and Bank of Communications to introduce contactless payment "by-the-wrist" to China.
The first four watches combine exciting, colorful yet functional Swatch design with built-in NFC (Near Field Communication) technology, allowing people to use their watches to pay for purchases in shops and stores around the country.
In his fascinating 1888 novel "Looking Backward 2000-1887", American writer Edward Bellamy envisions a utopian world in which cash has been replaced by credit/debit cards — Bellamy was the first to write about such cards, forty years before anyone else. Always happy to acknowledge fellow innovators and visionaries, Swatch has named its new pay-by-the-wrist watch "SWATCH BELLAMY".
SWATCH BELLAMY celebrated its worldwide premiere at a press conference held October 14, 2015 at The Swatch Art Peace Hotel on the Bund in Shanghai. Swatch Group CEO Nick Hayek, China UnionPay Vice Chairman Chen Zhi and Bank of Communications General Manager of Personal Finance Services Department Tao Wen presented the project to the guests and the press at the landmark hotel and site of the watchmaker's renowned artist-in-residence program. The three key players then signed the partnership agreement. The new payment option with SWATCH BELLAMY will be rolled out by the partners across China in the coming months, starting in January 2016.
The Swatch Bellamy uses NFC technology which uses high-frequency radio waves to enable electronic devices to communicate over short distances. The new watch has a built-in NFC chip hidden under the dial. Like a prepaid bankcard, the new watch allows customers to pay for items using merchants' contactless POS terminals. Pay-by-the wrist transactions require absolutely no energy at all from the watch.
The inexpensive Swatch Bellamy will sell for U.S. $91. China is Swatch's biggest market accounting for 40% of its 2014 sales. More contactless POS terminals with NFC will become more popular in the US and Switzerland in Q1 2016 when the new watch will debut, weeks after the launch in China.
It's Not a Smartwatch
Swatch Group's CEO Nicolas Hayek told The Wall Street Journal that the company won't expand the payment technology to its Tissot, Omega and other brands, and it won't create a watch that continuously connects to the Web, as the Apple Watch does, noting that Swatch aims to protect consumer data and doesn't want its watches to be reliant on electricity or the Internet.
Swiss Watchmakers Hurt by Apple Watch
Concerns about the rise of smartwatches have weighed on Swatch's stock price, which has shed nearly 12% this year, analysts say. And Swatch isn't alone on that one. Yesterday CEO of Tag Heuer, Jean-Claude Biver made it clear on CNBC's Squawk Box that the Apple Watch has been like a Tsunami and is HUGE competition for them in the under $2000 price range.
Last month we posted a report titled "Apple Pay Entering Last Phase before Entering China's Market Place." So while the Swatch Bellamy will be coming to China in January, it's unknown at this time if they'll be first to market with a payment system on a watch as Apple might be able to introduce the service on Apple Watch in the same time frame. But as always, only time will tell.