Ever since it became obvious that the iPhone was one of the most transformative consumer products in history, a question has been floating out there: Would its impact ever be matched by a device in an even newer category? And if something pulled it off, what would it be?After a decade and a halfso farwe arent any closer to getting answers. Yes, Apple has had its monster hits since then, especially the iPad, AirPods, and Apple Watch. But they havent been iPhone-size landmarks. Meta and others have poured billions into headsets and glasses with the explicit goal of replacing smartphones; still no iPhone. Imran Chaudhri and Bethany Bongiornoveterans of the iPhonetried to leap to the next level with their startup Humanes AI Pin, flopped, and recently off-loaded the remains to HP.I cant help feeling, though, that the most promising territory for the next great device is right there in front of us. Its our wrists, a location weve found handy for gadgets since the 19th century. Smartwatches demand no fundamental changes in human behavior to become part of our lives. By contrast, the AI Pinwhich you wore affixed to clothing, with your palm serving as the screen for its laser-projected interfacewas a failed bet on an altogether new experience.The fact that even the Apple Watch is merely an enormous success rather than an epoch-shifter doesnt mean the opportunity to create a radically new smartwatch is lost. After all, Apple didnt invent the smartphone. Contenders such as the BlackBerry and Palm Treo already existed. They were popular, even. Its just that the iPhone sprinted right past them into a new era of computing. It even surpassed fantasies about what an Apple smartphone might be like. (In 2009, I wrote about what most pundits had been expecting: pretty much an iPod that could make phone calls.)So as much as I cherish my Apple Watch, Id love to see a watch come along that makes it look like a BlackBerry. A few recent developments have had me thinking about that possibilityand, especially, the obstacles preventing it from happening.First, theres the future of the Apple Watch itself. Last week, Bloombergs Mark Gurman reported that Apple is investigating building cameras into its watchesnot for snapshot-taking or FaceTime calls, but to enable the companys Visual Intelligence AI. In theory, a camera-equipped Apple Watch could offer all sorts of new features based on it seeing the world around you, from better walking directions to nutritional information about food youre about to eat. It might have a shot at fulfilling some of the AI Pins utterly unfulfilled ambitions to weave AI into everyday life.Given Apples unsteady footing in AI (as exemplified by its ongoing failure to ship the new and improved Siri it first demonstrated last June) it would be ridiculous to get giddy over the prospect of Visual Intelligence on the Apple Watch. To be even mildly intrigued, you need to buy into Apple getting a lot better at conducting ambitious AI in real time, and doing it on a device greatly constrained by computing power, connectivity, and battery life. Still, it seems likely that someone will build serious AI vision into a smartwatch. One no-brainer candidate: Google, whose Lens AR technology has been useful for years and could become part of a future Pixel Watch.That brings up a fundamental issue with smartwatches, at least for iPhone users, and anyone who covets their business. Its that only Apple has a clear pathway to building an amazing new smartwatch that works with an iPhone. That is by design: The company provides itself with multiple custom affordances for integrating its phone and watch and is unwilling to share them with other manufacturers. For the decade-plus history of the Apple Watch, this fact has stunted the growth of the entire field.Back in 2012, before there was an Apple Watch, Eric Migicovskys Pebble helped create the smartwatch category. Migicovsky sold the company to Fitbit in 2016, ending its original run. Now hes back with a company called Core Devices that, as he told my colleague Jared Newman in February, is building a very slightly modernized version of what Pebble once offered. Its a sign of how slowly smartwatches have evolved that a minor upgrade to the 2016 Pebble actually sounds quite appealing.But in a blog post, Migicovsky wrote that the limitations Apple imposes on third-party smartwatches frustrate even Core Devices modest aspirations. His new smartwatch cant handle notifications as adeptly as an Apple Watch, is shut off from supporting SMS and iMessage, lacks an easy way to integrate with third-party iPhone apps, and cant access the internet if the Pebble app isnt running on the iPhone. The title of Migicovskys postApple restricts Pebble from being awesome with iPhonesconveys his bottom line, which is that Googles Android is a far friendlier platform than iOS for a company such as Core Devices.Migicovsky published his post on Monday of last week. Coincidentally, the European Commission dinged Apple the following day for the same kind of limitations that raised Migicovskys ire. However, the EC can do more than simply complain. In a ruling based on its Digital Markets Act, it has instructed Apple to make iOS work better with third-party smartwatches and other devices, providing a list of specific features (such as notifications) that the company needs to open up by the end of 2025. It also requires Apple to improve its communications with developers integrating products with its platform.As youd imagine, Apple is not looking forward to adjusting its product strategy and technical road map based on a government edict. Todays decisions wrap us in red tape, slowing down Apples ability to innovate for users in Europe and forcing us to give away our new features for free to companies who dont have to play by the same rules, the company grumbled in a statement. Its bad for our products and for our European users. We will continue to work with the European Commission to help them understand our concerns on behalf of our users.Apple hasnt yet explained its objections to the new EC ruling in detail. But it undoubtedly has several that go beyond its disinterest in helping other companies compete with the Apple Watch. For example, giving third parties more access to iMessage will introduce security issues that dont exist with the current closed loop between the iPhone and Apple Watch. Widening the deep iOS access that the Apple Watch enjoys to support other devices could also lead to a less reliable experience. The most likely outcome may resemble Apples compliance with an earlier EC ruling that forced it to enable competitive app stores. In that instance, the company acted grudgingly, making changes only in the EU and without any effort to create a great experience for anyone involved.I do hope theres at least a tiny chance that the ECs ruling leads Apple to make government-mandated lemons into lemonade. It could surprise us all by supporting other manufacturers smartwatches wholeheartedlynot just where its a legal requirement, and not in such a cumbersome fashion as to discourage anyone from taking advantage of it.This much seems certain: If Apple doesnt invent the next great wrist-worn gadget, somebody else will. Its kind of fun to think about that somebody else creating something so compelling that Apple sees welcoming it onto the iPhone as being in its own self-interestor at least a better option than giving iPhone fans any reason to even toy with the idea of switching allegiances.Youve been reading Plugged In, Fast Companys weekly tech newsletter from me, global technology editor Harry McCracken. If a friend or colleague forwarded this edition to youor if youre reading it on FastCompany.comyou can check out previous issues and sign up to get it yourself every Friday morning. I love hearing from you: Ping me at hmccracken@fastcompany.com with your feedback and ideas for future newsletters. 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