The upgrade program will be you can still use the bands you bought for the first edition, until they decide to change the attachment. The gold watches are rumored to come in a high-designed charging case, which would likely also work on the next generation. On future releases, they may just offer a watch face only, to drive costs down. Apple has never had an upgrade path for any other product, and it is highly unlikely they would start now, but just as you can often keep your iPhone accessories, so will be the same with the watches.
The gold watches do not make financial sense, especially in a smart watch that has a very limited life. You'll note it is just gold plating, and I really doubt these plated watches will exceed $1k. They will likely sell as a status symbol, but it will also generate interest in the lower but still overpriced steel and aluminum ones.
I also don't see updates coming out on a regular annual basis. Better battery tech is a few years off yet, so they can't go crazy with all the sensors until they can miniaturize the battery to make room and are able to power the more tech that people want. They've been working on this for years to come up with this chip, and how much smaller can anyone expect it to get in the next year? Look at the Mac Mini. Initially it was a huge decrease in size, yet now nearly ten years later it is only a little smaller. When you're working on such small dimensions, it becomes exponentially harder to further and further reduce it's size. I'm not saying that their goal in the next several updates will be reducing its size, but rather increasing it's functionality which entails reducing the size of the components to make room for more. Sure your iPhone is more powerful than NASAs Apollo computers that resided in rooms, but that has taken fifty years. I would expect a 24-30 month product cycle as it will not dominate computing like smart phones have. Apple likes to make a few products and sell a lot of them.
I can also see Apple and other manufactures starting to use the space now just used by the bands. I think later you may still be able to choose a cladding on your band, but why not utilize all that space for other sensors and batteries rather than just be a strap to hold it in place? It seems like heartbeat, oxygen, and blood pressure sensors could likely be better and smaller if they were located on the opposite side of the face where your veins run. I've never had a nurse put her finger on the watch face side of my wrist.
This will make money for Apple, but until it is a lot more powerful, it won't be the next iPod, iPhone, or iPad. Apple Pay and discrete text reading plus weather and time will be it's primary uses and justify the cost, but won't have the masses waiting in lines for every new update. Your phone and laptop will still be far more beneficial to you.
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