“If you left your home, and you left your smartphone and had to drive 20 minutes, would you go back and get it? Yes,” Cohen said. “If you forgot your belt, or you forgot your watch? No. If I created a product that made you as passionate about your watch as you are about your smartphone, that gives you information that gets you through your day, that’s when you know you’ve a made a mass market. The latter is a game changer. The former is an accessory.”

Fossil, which built smart watches in partnership with Sony Ericsson as well as with Microsoft in the last decade, currently has no plans to do more, CEO Kosta Kartsotis said.
“We do have a number of things we’re looking at and watching,” he said on a recent conference call. Still, he added, conventional watches are “a much bigger opportunity.”

“Apple can merge fashion with function,” said Marshal Cohen, an analyst at NPD Group. “An Apple watch could triple the size of the watch business in a year or two. They have the opportunity to get everyone that owns a cell phone to go out and buy another watch.”

So to me, what the above analysts are pointing to is that an iWatch is inevitable, likely to replace the iPhone and certainly to be highly profitable. The killer app may be FaceTime, which is rarely used on iPhones but would be logical on a wristwatch which already has a “face”.