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Did Tim Cook Really Dispute Reports of Poor Apple Watch Sales?

There’s a general perception that the Apple Watch hasn’t exactly taken off in a big way, at least not yet. I’ve never seen anyone wearing one. Or at least it wasn’t noticeable, not that I’ve gone out of my way to look.

In any case, IDC, part of the International Data Group that used to publish Macworld as a print publication, reported poor sales of the Apple Watch in the September quarter of 2016. Their surveys conclude that sales declined some 71% and it was the result, according to IDC, of an “aging lineup and an unintuitive user interface.”

Now I won’t comment on the latter, since I haven’t had enough experience with them to comment in a meaningful way. But watchOS 3, with loads of improvements, only shipped towards the end of that quarter, and the interface improvements may render IDC’s statement about usability moot.

It does make sense, though, for Apple Watch sales to be at a low ebb considering the product was first introduced in the spring of 2015. Anticipation of a new model could have also hurt sales.

Of course, we can only guess real Apple Watch sales. Apple buries the numbers in an “Other” category with other products on their financial statements. That decision was announced a the beginning; it wasn’t the result of any single unfavorable quarter. I suspect a lot of it had to due with the fact that Apple didn’t expect sales to take off very quickly. If sales were really terrific you’d see the numbers from Day One.

That’s just a theory, but why else would Apple keep the figures a secret? To spook Google and Samsung — or even Fitbit? Hardly. I’m sure they are perfectly capable of coming up with reasonable estimates of Apple Watch sales.

In any case, it’s clear that Tim Cook didn’t take kindly to IDC’s revelations, even tough they are probably correct. Instead, he wrote, in a statement to Reuters, that, “Our data shows that Apple Watch is doing great and looks to be one of the most popular holiday gifts this year. Sales growth is off the charts. In fact, during the first week of holiday shopping, our sell-through of Apple Watch was greater than any week in the product’s history. And as we expected, we’re on track for the best quarter ever for Apple Watch.”

Nothing in that statement actually refutes the IDC report, although some members of the media appear to believe he’s doing just that. Instead, it’s clear Cook is focusing on demand for the new models, introduced in late September,  during the holiday quarter.

From my vantage point, I don’t think it’s quite enough. While it’s fine for fitness-related activities, I would be far more interested in an Apple Watch when it’s fully separated from the iPhone except when you need the larger display, or to use functions that don’t require conniptions with the interface. It’s not as if you can type a decent-sized message on one, though Siri works well enough for a phrase or two.

Regardless, it’s early in the game to fret over Apple Watch sales, or argue whether IDC’s estimates — and they are estimates — are correct, or whether Tim Cook is actually lying about how well it’s doing.

My good friend Kirk McElhearn has written a column on the subject at his Kirkville blog, and he clearly isn’t buying what Cook is selling about the Apple Watch. He concludes, “pay no attention to the man behind the curtain if he won’t announce sales figures. He’s just spinning.”

That comes close to saying that Cook is lying, because he’s asserting several alleged facts. So is “sales growth…off the charts”? Did it achieve record sales “during the first week of holiday shopping”? There is no middle ground here. He is either making statements based on actual sell-through or he isn’t. There is no room for equivocation.

Understand that Kirk has long been skeptical of what Apple marketing does. In the course of his regular appearances on my nationally syndicated radio show, “The Tech Night Owl LIVE,” Kirk has asserted that he believes Apple deliberately constrains production at the beginning of a product cycle so they can boast that demand exceeds supplies. I don’t pretend to have any insights about this, but when shipments are delayed for a few months. it has to hurt potential sales.

If you order an iPhone 7 Plus now, nearly three months after it was first announced, Apple is quoting deliveries by December 22, but that’s cutting it close. Why would Apple take such a chance if it wasn’t the result of higher-than-expected demand, or some combination of demand and production hangups? The MacBook Pro, announced near the end of October, is still backlogged by up to three weeks for models equipped with the Touch Bar.

Holiday sales are critical to Apple. It makes no sense whatever to hold back deliveries just to look good. Yes, Tim Cook wants to put a positive face on less-than-favorable news, but there is no actual evidence to disprove what he said about Apple Watch sales. He isn’t actually refuting the IDC report, only reporting preliminary sales for a different timeframe, the start of the holiday shopping season.