Knock-offs beat Apple Watch to the draw

CHEAPER: A local alternative to the Apple Watch in Shenzhen


    Apr 24, 2015

    Knock-offs beat Apple Watch to the draw


    THE Apple Watch goes on sale today, but Chinese factories are already churning out cheaper alternative, to the delight of local consumers.

    "Our product has all the functions Apple Watch has, and even surpasses them," said Zheng Yi, founder of a firm whose watches can make phone calls, browse the Internet and play movies.

    His profits may lag behind the United States tech giant's, but Mr Zheng told Agence France-Presse that he "started working on smartwatches eight years ago, long before Apple".

    Apple has been hugely successful in China and industry analysts expect its smartwatch to be a hit with status-conscious consumers in the world's most populous country.

    But it is priced from 2,588 yuan (S$560), while Chinese alternatives cost only about a sixth as much wholesale.

    "The Apple Watch is quite beautiful...but we are more rapid in delivering the product, and much cheaper," said Mr Zheng, who welcomes the California firm's entry into the market as "a good thing" that will raise customer awareness.

    At a production line in the manufacturing hub of Shenzhen, workers in blue shirts and flip-flops soldered, glued and screwed the watches together, dropping them onto a conveyor belt after each step.

    A staff of around 100 can produce 2,000 smartwatches each day, enabling Mr Zheng's firm Shenzhen YQT Electronics to sell more than 50,000 units a month, he said.

    In contrast, some analysts estimate that Apple has already received several million orders worldwide for its watch, with the first retail consumers set to receive their products today. The Apple Watch is not available in Singapore yet, but the Apple Singapore website said it will be some time this year.

    Knock-off versions - with similar touchscreen displays and icons indicating e-mail and phone functions - already fill display cases at an electronics market in Shenzhen's Huaqiangbei district.

    "Would you like an Apple Watch?" one vendor asked, before quickly admitting that the product was an unbranded local imitation.

    The Chinese wrist-bound offerings differ from Apple's - most use SIM cards and essentially function like phones, while the Apple Watch depends on an iPhone for many of its functions.

    Said saleswoman Beryl, who sold smartwatches in a rainbow of colours: "We have had a lot more interest since Apple announced its watch. Sales are good."

    China's e-watch producers are concentrated in the southern city of Guangdong province, where foreign firms including Apple suppliers established huge factories more than a decade ago.

    Partly as a result, local upstart firms can now draw from a rich pool of design talent, and thousands of component-makers concentrated in a small area.

    Several such companies, including Mr Zheng's, have banded together to invest in a joint production line, hoping to move up the value chain by aiming for higher quality.

    Young workers perched on plastic stools pieced together the watches in a series of repetitive steps, before laying them in trays sideways. The near-silence was punctuated only by a regular electronic tinkling as devices were powered-up for testing.

    Guangdong has become notorious for counterfeit versions of leading electronics brands, but Mr Zheng rejected the knock-off label, adding: "What some might call knock-offs, I think of it as learning, absorbing the best practices and making improvements."

    A diminutive 38-year-old, he drives a BMW, enjoys golf and eating steak - but his office, by a litter-strewn passage in a remote industrial estate and reached by a rusty freight elevator, seems a far cry from Silicon Valley.

    Even so, his firm claims to have made the first watch to run Google's Android operating system. "We can take a product from an idea through to market research and design to production in six months.

    "I'd like to be a Chinese Steve Jobs," he added. "That's the dream."