All the World in a Wristwatch

Needless to say, if you wanted to buy one of these watches, you had to go to a jewelry store, to a shop dedicated to selling timepieces or to the most exclusive corner of a luxury department store. As premium items -- and thus a major revenue source for the retailer -- pocket watches were typically kept well-polished and displayed under lock and key under the watchful eye of a veteran employee or security guard.

World War I brought the next great turning in the story. Technological breakthroughs in tooling, combined with the demands of warfare -- the two great engines of change in the 20th century -- shrunk the pocket watch and put it on the wrists of officers in the trenches. The age of the pocket watch was over; the wristwatch era had begun.

Wristwatches accelerated a process that had already begun of bifurcating the market between expensive (usually gold) chronographs and cheaper (usually steel) everyday watches. Nevertheless, the cheap wristwatches of the post-WWI, even the post-WWII, world were still not that inexpensive -- and they were still most likely to be found in locked display cases. It really wasn't until the 1960s, when Timex began to produce low-cost wristwatches by the millions, did (some) timepieces finally come out from the display case. But they were still a long ways from that kiosk at Fred Meyer.

But now the real revolution was just around the corner.

I'm one of the few technology writers still working who remembers the arrival of the first digital watches. Even though the ground had been prepared with the first quartz crystal watches, digital watches still landed like a bombshell. First LED watches, which proved to consume too much battery power, then LCDs, which fit the bill nicely, then a growing number of added features -- indeed, as many functions as found in a whole laboratory of barometers, chronographs, medical monitoring equipment.

Somewhere in there, the original clock function, simple now to construct to an accuracy unavailable even to kings a century ago, became almost an afterthought. What had at the beginning of the century still cost a noticeable fraction of one's annual salary, now was available literally for pocket change. Clocks were now everywhere, even given away in children's free toys at McDonald's. And thanks to Moore's Law, it would only become cheaper and cheaper.

The lesson: Anything tech touches it ultimately commoditizes.

But I also remember something else: Those first digital watches cost retail nearly $400 in the mid-'70s -- likely more than a thousand bucks in today's money. It's no wonder then that the big semiconductor companies -- Intel, National Semiconductor, Japan's Casio, Texas Instruments -- all rushed into the market.

After all, a digital watch was little more than a microprocessor wired to a display and stuffed into a steel case. Everything else was pure profit. Even with a slow decline in retail prices, the chip companies looked forward to years, even decades of huge profits. It was going to be like printing money.

Five years later, nearly every one of those companies was out of the digital watch business, instead selling their chips to other watch manufacturers who were better able to squeeze a couple bucks profit out of the now $35 digital watches.

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