If they wanted to compete with a regular watch, correct. I don't think they do.
Well, but If they want to put a smartwatch on the wrist of everybody, and fill their safes like they do with IPhones they certainly would have to compete with the diversity that other brands of regular watches, luxurious or not can offer.
Also, they did sell an $17.000 limited edition gold Apple Watch.
With that price tag, they certainly weren’t marketing It for the common folk.
More for the Patek Philippe, Blancpain, Cartier...buyers.
So at that time they were indeed, although friendly, competing.
The biggest problem is that regular watches have only one main function...to tell time, therefor they are interchangeable. You use the one you like, the day you like and won’t miss a thing.
On the other hand, classic watches and smart watches are not interchangeable, they are two immiscible concepts.
Something gets lost when you leave one of them at home (art, style and uniqueness vs. mass production and information)
Since It makes sense to only own one smartwatch as opposite to multiple regular watches, how not to lose anything with the smartwatch experience, that is the enigma that they have to figure out.
The solution for sure is not the ludicrous priced wrist bands, those are just a pricey bandaid for the problem.