Apple's US smartwatch ban likely to cause "some bruising"

(Alliance News) - Apple Inc's latest patent dispute is a reminder the three-trillion-dollar firm cannot afford to become complacent in its hardware development, according to a Hargreaves Lansdown analyst.

A ban on Apple's latest smartwatch models came into effect Tuesday, with the Apple Watch Series 9 and Apple Watch Ultra 2 no longer available in stores or online.

The US International Trade Commission decided in October to ban the Apple Watch models over a patented technology for detecting blood-oxygen levels.

The order stemmed from a complaint to the commission in mid-2021 by medical device maker Masimo Corp, which accused Apple of infringing on "light-based oximetry functionality."

On Tuesday, the US Trade Representative's office said it had decided not to reverse the ITC's ban.

Apple contends that the ITC finding was in error and should be reversed, filing an appeal in a US federal court.

But the company pulled the products from the online Apple Store on December 21, with retail locations ceasing sales on Christmas Eve — just ahead of the holiday.

"The US International Trade Commission doesn't take accusations of patent infringement lightly which is why it invoked the ban in the first place, and the White House’s decision not to get involved, will be a blow for the tech giant. However, it is a win for smaller entrepreneurial tech firms, who need protection to spur on innovation," said Susannah Streeter, head of money & markets at Hargreaves Lansdown.

The dispute will cause "some bruising" for Apple, Streeter added.

"It means that die-hard fans who always want to get their hands on the latest kit, will inevitably have a much longer wait, and it will disrupt the sales pipeline," she explained.

Big tech firms are keen to stay at the cutting edge of the health tech market, which Streeter describes as "an engine for growth" in the coming years.

"This is particularly the case for Apple. Although it can rely heavily on the power of its brand, it can't be complacent and it will keep having to develop desirable hardware to sell its packages of services, everything from health and fitness to music to TV apps," she added.

Streeter continued: "Apple will want to emerge from this scrap with its finger on the pulse of the latest health trends. It'll come at a cost, but with its deep roots of funding, Apple is a tree which can weather this particular patent storm."

Shares in Apple closed down 0.3% at USD193.05 each in New York on Tuesday, having fallen 1.6% over the past week.

By Elizabeth Winter, Alliance News deputy news editor

Comments and questions to [email protected]

Copyright 2023 Alliance News Ltd. All Rights Reserved