Disappointed that Apple has not released anything innovative for a while, Piper Jaffray analyst Gene Munster has started hyping up sales of Apple's vapourware.
According to USAToday, Munster has started making bold claims for Apple's iWatch, the rumoured vapourware from the fruity toymaker that no one's ever seen.
He claims that Apple will sell ten million of them, even though efforts to create wearable computers by rivals have already shown that the market is limited.
Munster said that all this will add more than $2.5 billion to the company's top line and over $750 million in profit
To be fair to Munster, he did not think that this level of cash would be that significant to Apple, but he said that the release of an iWatch will show Wall Street the company is still innovating by copying everything that its rivals have already done.
Munster's views were based on a survey where 799 US consumers were asked whether they would buy an Apple iWatch that connected to an iPhone for $350.
Only 12 percent of those with an iPhone said they would, presumably going on to form an orderly queue outside the nearest Apple store.
The rest said that such a gizmo was perfectly pointless and they would rather sell their children for medical experiments rather than waste cash buying such a pointless piece of tat – we are paraphrasing a bit here.
However, Apple's user base is so big, with 293 million users, that Munster "conservatively" extrapolated from the survey that two to four percent of global iPhone users may buy an iWatch when, if ever, it comes out. The rest of the users will be happy to take their phone out of their pocket when it rings.
This means first year iWatch sales of 5- 10 million units. If Apple ended up selling 7.5 million of the devices at $350 each and with a 30 percent gross profit margin, that would generate $2.6 billion in revenue and $790 million in profit, Munster estimated.
But that's only one percent of Apple's annual revenue and profit, so the direct financial impact would be limited. But Munster thinks it will calm Wall Street, where mumblings are that Apple's days of coming up with new ideas are over.
Where this all falls down is that Apple has not said whether it will launch a smart watch. The closest Apple has come to saying such a thing was when CEO Tim Cook mentioned that wearable technology is "profoundly interesting" and that the wrist is a "natural" use case.
That was before Apple's rivals, such as Samsung, beat Apple to the punch and released their own. The company won't be keen to be regarded as a copycat and would lose any mojo from such a product release. The rival's watches were greeted with a collective yawn from the market, which suggests many do not see the need for them.
Apple's own gear will have to be special. Based on its history with MP3 players and tablets, it is possible that Apple has shelved the product until the rest of the industry forgets all about the technology, and then hypes its own version to the skies.