Masimo successfully obtained an Apple Watch sales ban at the U.S. ITC, but the medical technology company's CEO Joe Kiani nonetheless remains open to settlement talks with the world's largest smartwatch maker. According to a report, a settlement with Masimo is the best option for Apple, which would have to shoulder a lot of responsibility if it looked for another way, not only in software and hardware changes to its lineup of oximeter-enabled wearable devices.
Apple's settlement history shows that it has had to pay millions or even billions of dollars in damages many times before.
In TrendForce's latest report, the research firm highlighted two methods for Apple to resume sales of the Apple Watch series. One is to adjust the product's software and hardware, reapply for approval, and then potentially resume sales.
"Given the current situation, there are several possible developments. First, Apple may reapply for regulatory approval of redesigned models, allowing them to resume sales after making necessary adjustments."
Sadly, this appears to be just paper, as changing the Apple Watch's internals could take months, not to mention the time it would take to review the modifications. Considering that the Cupertino giant launches a new model every 12 months, this decision seems unrealistic from any angle, leaving Apple with only one option, which is to settle with Masimo.
Sadly, Apple also has a rocky history with settlements, having lost battles with companies like Qualcomm and having to pay around $4.5 billion. Masimo, on the other hand, has previously won two patent infringement cases, one of which resulted in a licensing agreement that generated $1 billion in revenue for the medical organization. Furthermore, if Apple does reach a settlement with Masimo, it would mean the California-based giant admitted to using stolen technology, which would damage its goodwill around the world.
"Secondly, Apple may choose to settle with Masimo. In the past, Apple has had disputes with Qualcomm over issues such as chip technology and intentional slowdowns of older devices, and they have been resolved through user class actions. However, the settlement amount is huge. Taking the previous Qualcomm as an example, the settlement amount was as high as 4.5 billion US dollars. Compared with Apple Watch, the annual revenue in 2023 may not reach 20 billion US dollars. Such an outcome may not be cost-effective for Apple."
Since the U.S. Court of Appeals for the Federal Circuit has lifted the ban until January 10, Apple has only been given a small window of opportunity to perfect imports and restocks, but that time limit expires tomorrow, and we have yet to hear what changes will be made to the current-generation Apple Watch models. If a software update doesn't help resolve the issue, a settlement may be the only way forward, and as things stand, that could prove to be a costly bill.
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