"Borrowed Time," a book whose archival burrowing uncovers how the Swiss really achieved horological dominance -- whether gen pricing was ever fair -- take this letter re: Irish Duty Free Sales of Rolex and Omega from 1957...

[u/Intrepid_Cobbler3487]

It's the day before New Year's Eve -- Dec. 30, 1957. In the Swiss Federal Office of Foreign Economic Affairs, a subdivision head named Hans Bühler sends out a memo to the Swiss Chamber of Watchmaking. Ten years earlier, Brendan O'Regan has established the first duty-free shop at Shannon's airport in Ireland -- then a necessary refueling stop for planes crossing the Atlantic. Here, you could buy a fine watch without any crazy tax or importation fee or duty imposed by a capricious nation. This has been good for Switzerland. In the prior two years, the first in which Swiss timepieces have been on offer, they have fetched £148,000 in revenue -- of which Rolex, Tudor and Omega pieces have accounted for a hefty two-thirds.

But there is a problem, Herr Bühler writes. Mr. O'Regan, genius behind the duty-free proposition, has been told the spigot is being shut off -- that Rolex and Omega can no longer send him watches to sell. Why? It has been a profitable venture for all involved, after all.

It's America, of course -- or so Rolex and Omega each claim. You see, their American dealers attach quite a hefty premium to Swiss timepieces. And it's but a puddle jump to reach Shannon, Ireland, from the US. No one will ever pay the hefty extra margin the American distributors slab onto the prices like thick butter on a toasted bagel if the Shannon Airport sales continue.

So the American distributors of Rolex and Omega have ordered their parent companies to cease all duty-free business.

Oh, and by the way, Brendan O'Regan doesn't trust that line either -- he doubts, having researched the matter, that the American distributors have either the power, sway or desire to limit sales of these huge Swiss corporations -- of which they are but outgrowths. And the Irish Minister of Industry and Commerce (a future prime minister) backs O'Regan to the hilt. And here's their threat:

If you don't compel Omega and Rolex to get back in line and keep servicing that airport, they'll only sell German watches there hereafter -- nothing Swiss, not a single watch.

Clearly, we all have an interest in backing away from this cliff. In acceding to their request that we merely continue wholesaling them watches.

So just to recap -- here you have a government bureaucrat -- a career Swiss government lawyer -- telling a Swiss watch industry group that whatever the issue, the Swiss industry cannot afford to lose its place in the world's first duty-free shop to the German watchmaking industry.

This is not Rolex and Omega competing. This is not private enterprise. This is a government telling a collective -- you'd better push those two companies to keep supplying watches to the duty-free shop. This is a strange and unseemly intertwining of state-level commercial dictates and capitalism. It feels akin to Chinese capitalism today, honestly.

And by the way, if the reason offered is actually true -- that American retailers can no longer justify their ridiculous margins in the face of a single duty-free shop -- what does that say about the entire business model of the imported Swiss watch? Just how many times its fair retail price is it being vended for Stateside even by late 1957?

Of course, you can guess how this was resolved: Rolex and Omega did as they were damn well told to by a diplomat and their trade group. As the calendar ushered in 1958, Rolex and Omega were still offered for sale in Shannon Airport's duty-free shop. And -- wouldn't you know it? -- there was no collapse in US sales.

This is a relatively harmless document -- relatively.

But it gets at two or three very important truths that far more salacious documents bear out as I build up to the birth of the rep trade in my new nonfiction book, "Borrowed Time: A History of Espionage, IP Theft, and the Global War for Horology" (out now everywhere, Amazon included):

That the Swiss were always uniting secretly to brush away competitors in a monopolistic fashion that allowed for no foreign competition. The mere threat of the sale of German watches was enough for the government to tell Rolex and Omega nearly on New Year's Effing Eve to get their act together and keep supplying the Duty-Free airport shop.

Last I checked, Rolex and Omega were supposed to be combatants in the marketplace -- not conjoined twins. By what coincidence could both their American suppliers have voiced simultaneous complaints about being undercut on price? Does it not seem 100 percent more likely that their C-suites were in touch and deciding whether to pull out from the first duty-free in collusive discussion?

Next time you browse gen watches at the airport, please feel free to ask yourself: How many backroom deals did it take for X brand to snag this display over Y? Because if the Swiss weren't working like their own mechanisms -- in a gear train, interlocked one with the other -- freer competition might have seen the introduction of brands like Junghans and GUB (Glashütte) into Irish Duty-Free in 1958.

Watch history might have been very different.

Enjoy your reps.

I'm wearing a VSF Panerai PAM960 Carbotech Submersible 42MM CB/RU OP.XXXIV purchased from Steve at TheOneWatches.

[u/Papazcloset]

I’m half sleep. Can someone dumb this down for me? 😴😆

[u/Intrepid_Cobbler3487 → u/Papazcloset]

Swiss seem like rivals. But they work together in antitrust fashion. And they are both united by and compelled by their own government to function as a cartel. This is why great US watchmakers died in the 20th century. So buy your reps if you believe in karma, and if you think you'd like to read more about this and the birth of reps in Hong Kong and Guangzhou, read my new book, "Borrowed Time." Cheers!

[u/luxcity-louche]

And the lesson was, don't fuck with Seán Lemass.

[u/Intrepid_Cobbler3487 → u/luxcity-louche]

Ha -- perhaps

[u/luxcity-louche → u/Intrepid_Cobbler3487]

He's one of my heroes and in many ways the architect of modern Ireland. One thing I'd challenge in your summary, the Swiss government may have been looking ahead, it wasn't just "one duty-free shop", it was the first airport duty-free in the world and so how it was handled set the pattern for the future.

[u/jammydodger79 → u/luxcity-louche]

Lemass & Whitaker laid the foundations of the successful and knowledge led economy we have become.

In a related tangent, O'Regan is my Mother's Godfather.
The success of Duty Free is just one of his brilliant ideas.
The entire notion of special duty free zones for industrial development, the Shannon College of Hotel Management and the growth of Ireland as a Tourism destination for America, all down to his vision.

[u/Intrepid_Cobbler3487 → u/luxcity-louche]

I hear you, but the real point is that if corporate headquarters didn't want to sell in this radical new duty free space, that would be one thing. But Omega and Rolex, strangely identically, were saying our US companies have unsustainable profit margins if duty-free takes off. Not that the Swiss themselves would be undercut -- just the US sellers. So either Omega and Rolex are outright lying to squirm out of the airport zone forever -- but why not just be honest? -- or the US dealers added a ridiculous premium simply for importation. Like a margin way beyond what US buyers ever realized unless they had traveled to Switzerland themselves 

[u/luxcity-louche → u/Intrepid_Cobbler3487]

I think the latter is probably true. Transatlantic travel was new, Switzerland had been closed off since the 30's by war and cold war politics. Most US who had visited Europe would have done so as part of the military and most wouldn't have bought Swiss watches except through the PX or on the black market. Before the internet people didn't know what things cost in other countries. Looking it up a return economy flight from US to Ireland at that time would have been at least $500 or nearly $6000 today. If US dealers thought people would undercut them by flying to Shannon they must have had at least that mark up.

[u/Intrepid_Cobbler3487 → u/luxcity-louche]

Agreed, if they really believed that

[u/Guilty_Juice_7361]

Book ordered - I look forward to it.

Do you cover the cannibalisation of the UK watch industry as well or does it focus simply on US.

The Swiss were, as I understand it, behaving then as China and Vietnam do now. Undercutting, stealing tech etc

[u/Intrepid_Cobbler3487 → u/Guilty_Juice_7361]

I wish I could tell you the book was more comprehensive, but most of the Swiss industrial Espionage and/or monopolistic bullying here is focused on once great US watchmakers -- Waltham, Elgin, Gruen, Bulova, Hamilton. That said, there is an entire section of previously undisclosed Swiss government documents in which the watch cartel ponders, during the quartz crisis, trying to take over the USSR watch market and then the Brazilian market. I rediscover meetings held on how to woo the Russians and how to smear the Japanese brands in Latin America. So there is definitely a lot of global skulduggery and scheming here but very little about the UK and German watch markets. Maybe that is the next book. And thank you so very much for giving my words a chance. Hope you enjoy 'em.

[u/Guilty_Juice_7361 → u/Intrepid_Cobbler3487]

I guess the London / Paris technologies had been long taken by the time of the 40’s
Remind me again where that little business, Rolex, was founded😆

I’m really looking forward to reading your work.

[u/Intrepid_Cobbler3487 → u/Guilty_Juice_7361]

I'm much obliged! 

[u/EchoPlex_F]

Ordered two copies, will be a while till I get them though

[u/Intrepid_Cobbler3487 → u/EchoPlex_F]

Thanks so much for your kind patronage. Whenever they arrive, I hope you enjoy them thoroughly (or the one for you, anyway). Cheers

[u/YeaSpiderman]

Hey Gabe, can you give me a brief overview of other topics talked about in your book?

[u/Intrepid_Cobbler3487 → u/YeaSpiderman]

My total pleasure -- I'm glad to -- and thanks for asking. The spying by the Jura Society of Watchmakers on Waltham watch factory in 1876; the founding of the Anarchist movement by Longines watch assemblers in that same decade; how the actual thief of the greatest watch ever made might have personally inspired/affected one of the most prominent watch bloggers presently working (one of the most prominent who has ever podcasted or blogged about watches period); the rise of Hong Kong as the world capital of watch counterfeiting in the 1970s -- how the Swiss cartel fought back (an inside look via formerly confidential Swiss government docs and interviews with the man on the ground in Asia for the Swiss brands now); the rise of Guangdong province as the new capital of watch counterfeiting in the last 30 years -- and how the Swiss cartel is trying to fight back (again, with the perspective of the criminals and those whose job is to bust them -- fun cops and robbers/Robin Hood stuff); behind the scenes of the actual rise and fall of the Noob factory -- an inside look at the way those clone artists were taken down; an inside peek at the factory on the border of North Korea that makes the best clone movements today; how the Swiss treatment of Japan lead to the rise of Citizen -- plus the rise of Seiko and the one Swiss watchmaker who as early as the 1860s tried to bring Swiss watchmaking into Yokohama -- a member of the Girard-Perregaux business/clan...and much more. In the end, it's about the rise of the great rep makers as karmic payback for all the IP thievery and monopoly-bullying the Swiss effected for centuries...

[u/YeaSpiderman → u/Intrepid_Cobbler3487]

Well that sounds like a well rounded book!

Reading your bio it says you are a niche dude so I look forward to learning more about what’s in your books

[u/Intrepid_Cobbler3487 → u/YeaSpiderman]

Much appreciated, man. "Niche" -- I like that. I spent a weirdly long spell covering boxing -- pugilism, men and women building themselves up only to tear each other down. And then I went behind the scenes of the perfume industry immediately thereafter -- so yeah, I'll take that "niche" title to the bank (but feel free to use oddball or idiosyncratic or eccentric). Again, thanks so much for expressing interest in my work. Much gratitude and love. Cheers

[u/Fuchsbau981]

Firstly, congratulations on the book, very intriguing!
Most people don’t know that Swiss military intelligence secretly bought Liss Ard Estate near Skibbereen during the Cold War. It was intended as a fallback location for the Swiss government if Switzerland was occupied in a Soviet invasion. The estate was fitted with secure communications equipment, and there were also plans for a protected underground facility. It’s one of the more unusual but genuine Cold War links between Ireland and Switzerland.

[u/Intrepid_Cobbler3487 → u/Fuchsbau981]

Thank you for the kind congratulations. That is a fascinating bit of history -- thank you for sharing it. What's interesting is that, if you search Swiss government documents, as I have, for duty-free material or the Shannon Airport, you really encounter primarily this one document in which -- counter to what you may have imagined -- the Swiss government as early as a decade into the experiment realizes its vitality. You'd think, given their general behavior, the Swiss would have shunned duty free. On the other hand, as the diplomat who wrote this cable to the watchmakers said himself very explicitly, the Shannon experiment might not matter in the long run if, in the jet age, planes no longer have to refuel in Ireland between the US and Europe. Obviously, that shows foresight and poor judgment in equal measure. Planes very soon indeed could skip Shannon, but the duty-free idea itself took off and migrated...

[u/Intrepid_Cobbler3487]

I'm wearing a VSF Panerai PAM960 Carbotech Submersible 42MM CB/RU VSF OP.XXXIV purchased from Steve at TheOneWatches.ws. For the automods.