Believe it or not, smartwatches may now be more expensive than smartphones?

When Apple priced the iPhone X at $1,000, it caused a huge stir. However, after it became a big hit, it was no longer a novelty for Samsung, OPPO and other companies to launch smartphones priced at $1,000. Recently, Huawei launched its next-generation 5G folding smartphone, which will cost $2,600?

The above are all mobile phones. Obviously, high-priced flagship phones attract more attention, but in fact, most of the unnoticed smartwatches are more expensive than smartphones. According to Strategy Analytics, the average price of a 2-inch smartwatch has exceeded that of a typical 6-inch smartphone.

Pricing tug-of-war

Ignoring the luxury smartwatch market (Breitling's Exospace B55 can go for as much as $8,650), Apple has driven smartwatch prices up dramatically. The Watch 4 models range from $399 to $849, and of course, the Hermès edition can set you back $1,500.

Other manufacturers have also introduced models that push the pricing ceiling. Garmin, for example, starts at around $300 for this watch, but it offers many smartwatches for $1,000 or more, including its new Marq series, which starts at $1,500 for five different models. Suddenly, a Fossil smartwatch that costs $275 looks like a bargain.

While smartwatch prices have surged overall, there is a counterweight that has resisted the rise: For example, smartwatches running Alphabet's Google Wear OS cost between $200 and $300, while Samsung's smartwatches are priced around $400.

Amazon also just dropped prices on smartwatches on its site, though only on some older-generation models like the Apple Watch 3. It's selling the gorgeous Amazon BIP for $70. It may not have all the bells and whistles of the pricier brands, but it has GPS, optical heart rate monitoring, an activity tracker, Bluetooth, and smartphone notifications.

Pricing drives market share

Lower prices are one reason some analysts are bullish on Fitbit again. A few weeks ago, it announced a "lite" version of its $200 Versa smartwatch that it plans to start at $160. Making a more affordable smartwatch could tie in with its health and wellness services, which could help boost Fitbit's recurring revenue.

While Apple, Garmin and others are producing splashy wrist accessories, those that make more affordable models are gaining market share.

Strategy Analytics said Apple still dominates the global smartwatch market with a market share of 50.7% in the fourth quarter of 2018, but that was down 16.5 percentage points from last year.

In contrast, Samsung soared to second place with a 13.2% market share, a 2.5-fold increase from the fourth quarter of 2017, while Fitbit's market share tripled from 4.3% to 12.7% in the same period last year, jumping to third place.

Still, Apple sells a lot of smartwatches: 22.5 million in 2018. So while the recent trend of smartwatch prices exceeding smartphone prices may eventually turn, especially as more expensive smartphones enter the market, it seems clear that many consumers are ready to pay the price to wear something similar to a smartphone on their wrist.