The rumours have been increasing over the last 12 months to a point where if Apple didn't release a watch the world would be shocked.
To be honest, I think Apple have their work cut out if they want to compete - but that's what we said about the iPhone. Apple don't tend to enter a new category without the intention of having the best product.
Lets examine what, in my opinion Apple would need to create to dominate the category.
Now, I know that sounds obvious but there's no point in creating a device that nobody would wear on their wrist all day and can't tell the time.
Watches are all different weights, some light some a bit heavier but nobody wants an iWatch equivalent of the iPhone 4s! The iWatch would need to be heavy enough to know it's there without being an issue.
The thing that Apple haven't done before is create a device that is specific to a gender. Yes, they've released different coloured iPods and laptops but never a device that's essentially the same but with a different form factor. Typically watches are designed to be different sizes or shapes to appeal to the different genders. It will be interesting to see how Apple tackles this. I have a feeling that in the first iteration they'll release a single design.
Apple's thing at the moment is increasing battery life, look at the new MacBook Air's when they're running Mavericks you can get 10 hours out of them. The iWatch won't be an exception. I have a Fitbit and while I love wearing it it irritates me every week when I have to charge it, I can't imagine how painful it would be to worry about something that's more deeply integrated in to my life. There's been talk of solar and kinetic charging but I still have a feeling we'll be charging regularly, I just hope it's not every day!
The Pebble uses an LCD that looks and acts like an eInk screen and the Gear uses a Super AMOLED screen. Apple will need a screen that doesn't burn through the battery but can render full colour - we're not expecting Retina in the first version (much like the iPad mini) but Jonny Ive will still want to describe it as gorgeous, beautiful or some other superlative.
This is where I think Apple will excel. Think back to the first iPhone keynote, everyone wondered what the hell an Internet Communicator was - it turns out that was the "thing" that made the iPhone. I'm really excited to see what Apple will do here, I'm sure they'll have a fitness app and notification centre but it;s the unknown that will define this sector.
There's a plethora of other "required" features but most of these will be a given: Water resistant, changeable bands, alarm clock etc etc.
Now, we just have to wait and see what happens.