From The Telegraph's interview with Apple's Kevin Lynch on the timekeeping features of Apple Watch:
Apple built its own Network Time Protocol (NTP) servers at various locations to ensure the delivered time is as close as possible to Stratum One accuracy, the time server which keeps the Apple Watch within microseconds of Stratum Zero devices - the highest possible quality for time references.
Once the time reaches the Apple Watch, the team worked to ensure it remains accurate, he says. Each device uses a temperate controlled crystal oscillator to counteract the natural drift that clocks and watches tend to experience over time.
I'm not sure any human watch wearer would ever notice a 50-millisecond difference – especially when waiting for midnight at a New Year's Eve party – but still, fascinating tech.