Masimo CEO on Looming Apple Watch Ban: 'These Guys Have Been Caught With Their Hands in the Cookie Jar'

[CarAnalogy]

So they're willing to settle. Just get it over with, Apple. You were already ruled against.

Well…it sounds like they are willing to settle for way more than Apple is willing to give. Will be interesting to see how this goes.

Edit: not sure what someone could disagree with. If they would settle for what Apple is willing to give this whole thing would be over by now.

 

[CarAnalogy]

View attachment 2326861

And just like Masimo, Michael Scott’s best option was a buyout.

Edit: What, did you really believe in the Michael Scott Paper Company?

 

[Zest28]

Well…it sounds like they are willing to settle for way more than Apple is willing to give. Will be interesting to see how this goes.

I read somewhere they want $100 per watch. That is crazy.

Just discontinue the Apple Watch. Most of the current models have been sold already since it has been out for a few months. It is not worth paying billions, as the peak has worn off.

It makes much more sense to speed up the release of the Apple Watch Ultra 3 and Apple Watch Series X, than paying billions to this company.

And Apple can always still appeal in any case, so this is not the final decision.

 

[Zest28]

Masimo is a $6 BN company. Just buy it.

Hell no. If Apple uses their oxygen monitor, it is worth $0, because this things doesn't even work good.

Apple can create something better themselves really if this is the "benchmark". Just hire some top researchers in this field and make something better, and it will cost way less than $6 billion.

 

[Zest28]

Here is some quick math btw.
1. Approximately 43% of all revenue comes from the USA.
2. Let's assume that 43% also holds true for Apple Watch sales.
3. Apple Watch makes around $20 billion in revenue globally.
4. $20 * 43% = $8.6 billion of Apple Watch revenue in the USA.

If Apple makes only $8.6 billion from selling Apple watches, it makes no sense to pay $6 billion for a silly oxygen monitor which isn't even accurate to begin with.

 

[atomic.flip]

No patent trolling here at all. Pay up Apple.

They aren’t patent trolls. They actually make medical equipment like the pulse oximeters and they get used in medical facilities routinely.

That said I’m not a fan of the company or their CEO.

 

[Zest28]

They aren’t patent trolls. They actually make medical equipment like the pulse oximeters and they get used in medical facilities routinely.

That said I’m not a fan of the company or their CEO.

To be fair, Apple and this company are not competitors. Apple makes sports watches and this company makes medical equipment.

Which doctor will seriously use an Apple Watch to check the health of his patient? If you see a doctor doing this, run away as fast as you can.

 

[svish]

If software changes do not fix the issue, Apple may be forced to reach an agreement. Otherwise future Apple watches also face risk. Don't think hardware changes can be implemented immediately for the next year's model

 

[Mikeske]

I am going to say this way from an average comsumer that has a few health issues. I use to blood oxygen sensor as a monitor. I know that it is NOT a medical device but it can be useful information to monitor the O2 levels over time and then notify my doctor if anything is not quite what it seems. The same as the AFIB and the the sensors that monitor my heart health.

I bought an Apple Watch for these reasons and I do monitor my heart health and how much activity I am doing. In my opinion Masimo and Apple really need to go to the table and negotiate an equitable deal. I really do not understand something like this as this can have a huge impact for the folks like me that do have to monitor our health.

Just this week my wife has had a cold and I have been monitor her blood oxygen levels on her Apple Watch series 8 as she has had pneumonia a few years ago and I don't want to wait it out then have her in the hospital again where she will have a difficult time as she also has dementia and at home care for her is the best as she is not as confused by her surroundings as would be in a hospital.

Apple and Masimo get it together and negotiate.

 

[AndyJapan]

Masimo has always been a sue-happy company. It’s part of their DNA.
Apple will compare both options (licence agreement with Masimo or redesign of the Apple Watch) and move on. Neither company will suffer any financial loss, as the customers will foot the bill at the end of the day.

 

[AlmightyKang]

The way this has been described -- Apple pays Masimo a visit, talks about a partnership, then suddenly several key Masimo employees are working at Apple reinventing Masimo's wheel -- feels absolutely like something our Apple would do. Apple is so addicted to high margins that it's practically allergic to paying up for things it wants. Remember how they pay ARM thirty cents per chip?

This is normal. Why would you continue to work for Masimo as staff if you know Apple turned up and the company walked away empty handed? You'd think Masimo execs are crazy bonkers lunatics and start looking at your options. Same thing happened with my last company - big investment firm turned up and the offer was declined because the company thought through some ignorant self delusion that they were top dogs and were going to walk all over the market. Everyone slowly trickled away into the other company, me included. We weren't asked or poached, we made that decision ourselves as staff. And you know what? We built the same product at the new company completely clean room. But that's software so patents are a non-issue.

Regarding ARM, that's the licensing fee for all the ARM vendors. The only thing Apple are using is the ISA which is the description of the instruction set the machine uses. The rest of the thing, which is really where the cost is was completely developed in house.

The issue here is:

1. Masimo entered talks with Apple and loudly announced it in October 2023 to boost stock because they're not doing very well. Other than their medical lines which are established, their consumer market entry no one has even heard about.
2. Masimo got greedy and asked for too large a cut for a minor functional unit (they are currently asking $100 a watch apparently)
3. Apple said nah it's ok as they clean roomed their stuff in house.
4. Stock didn't do anything useful.
5. Masimo fires up the lawyers and uses the PR to leverage (2) for the investors.

End game:

6. This boosts investor confidence and value, during which Masimo CXO will dump all their stock and retire.
7. Company will fade out slowly while larger medical tech companies consume their product lines and market.

I haven't even seen the patent yet but based on prior art coming out of china on SPO2 sensors, something which I was actually involved in the development of years ago, I would suggest that the patent will be a trivial one barely related to the problem. Time will tell.

Masimo looking like normal MBA corporate idiots. That's the story

 

[SlipSlidinAwa]

Masimo CEO Joe Kiani does not believe that Apple will be able to solve its patent infringement issues with software, reports Bloomberg. In an interview with Bloomberg TV, Kiani said that a software solution won't work because Masimo patents cover hardware, not software. "I don't think that could work -- it shouldn't -- because our patents are not about the software," said Kiani.

Apple is reportedly working to change the algorithms used for the blood oxygen sensor in the Apple Watch to skirt Masimo patents, with engineers aiming to adjust how oxygen saturation is determined and how the data is provided to customers. An Apple spokesperson said yesterday that Apple is planning to submit a workaround to the US Customs agency to determine whether a software change is enough to avoid an import ban.

Masimo would be open to settling its dispute with Apple to prevent the Apple Watch import ban that Apple is facing, but Apple so far has not expressed interest. "They haven't called," Kiani told Bloomberg. "It takes two to tango." Kiani did not mention the amount of money that Masimo would accept to settle, but he said the company would be willing to "work with them to improve their product."

According to Kiani, he has not spoken with Apple since 2013, which is when Apple considered purchasing Masimo or getting Masimo's help to develop the blood oxygen sensors in the Apple Watch. Masimo has accused Apple of employee poaching and patent infringement, and the U.S. International Trade Commission in October agreed that Apple has violated Masimo patents with the Apple Watch.

As a result, Apple is facing an import ban on the Apple Watch Series 9 and Apple Watch Ultra 2, with sales set to stop starting on December 21. "These guys have been caught with their hands in the cookie jar," Kiani said. Masimo wants an apology and an "honest dialogue" as part of any settlement discussion.

Apple's announcement that Apple Watch sales will stop in the U.S. on Christmas Eve is a "stunt" that is meant to pressure the Biden administration, according to Kiani. Apple did not have control over the timing of the import ban.

Apple for its part said yesterday that it "strongly disagrees" with the ITC's order and import ban decision, and that it is "pursuing a range of legal and technical options" to keep the Apple Watch available to customers.

It is possible that Apple will avoid an import ban and a pause in sales if the Biden administration vetoes the ban by December 25. It is not clear if the White House will step in, as presidential vetoes of ITC bans are rare.

While Apple will not be able to continue selling the Apple Watch in the U.S. without a veto, third-party retailers like Best Buy and Target can continue to offer it as long as supplies are available. The import ban will prevent Apple from importing components and assembled devices from countries like China.

The ITC's decision will not impact sales of the Apple Watch outside of the United States.

Article Link: Masimo CEO on Looming Apple Watch Ban: 'These Guys Have Been Caught With Their Hands in the Cookie Jar'

Its what Apple does

 

[bousozoku]

Apple will change the algorithm and beat the band and just wait them out until they’re patent expires or they can just do a hostile takeover of the very, very small company

How do you change the algorithm of a hardware device? The patent is for hardware, not software.

 

[laptech]

The way this has been described -- Apple pays Masimo a visit, talks about a partnership, then suddenly several key Masimo employees are working at Apple reinventing Masimo's wheel -- feels absolutely like something our Apple would do. Apple is so addicted to high margins that it's practically allergic to paying up for things it wants. Remember how they pay ARM thirty cents per chip?

If that is how it transpired then it's history repeating itself. Steve Job's visits Xerox, see's their GUI in use, steals their idea and incorporates it into Apples operating system.

Also, if memory serves me right, wasn't Apple found guilty of patent infringement with one or more of Qualcomm's patent's a number of years ago that caused a potential import ban but Apple avoided the ban by sitting down with Qualcomm to come to an agreement? If that was the case then I have no doubt Apple will do the same here. Money talks and rather than force an import ban on Apple watches, Masimo will give in to a financial settlement.

 

[reery]

There is more to these stories than outsiders will ever know. It would be foolish for anyone to draw conclusions at this point. Each side has their own version of the story. The side that uses the media to amplify their version is usually the desperate one.

Smartest opinion here.

 

[Zest28]

If that is how it transpired then it's history repeating itself. Steve Job's visits Xerox, see's their GUI in use, steals their idea and incorporates it into Apples operating system.

Also, if memory serves me right, wasn't Apple found guilty of patent infringement with one or more of Qualcomm's patent's a number of years ago that caused a potential import ban but Apple avoided the ban by sitting down with Qualcomm to come to an agreement? If that was the case then I have no doubt Apple will do the same here. Money talks and rather than force an import ban on Apple watches, Masimo will give in to a financial settlement.

I don't think so.

A ban on the iPhone using a core technology is quite different. Without the iPhone, Apple might as well shutdown the company and the modem is an essential technology of the iPhone. There is no way around it.

The Apple Watch simply needs to have a oxygen monitor that is comparable to Garmin, that's it. So Apple can (and in my opinion should) suspend sales of the Apple Watch and develop a new oxygen monitor that is competitive against Garmin. There is no need for a medical grade oxygen monitor in the Apple Watch (which I didn't find that good to be begin with).

It makes no sense for Apple to increase the price of the Series 9 from $400 to $500 and the Apple Watch Ultra 2 from $800 to $900 in order to give Masino their $100 cut. The oxygen monitor is not worth that type of money and certaintly not a core feature.

 

[threesixty360]

As far as I understand this is to halt sales before they even get to court right? So Apple hasn't been found to infringe anything, but an injunction is being used as a weapon to force apple to pay up ($100?) or even buy them.

I'm guessing that even if the patent is about hardware, the solution has to perform its full function to be found to infringe right? So if Apple just disabled the monitor on US watches it wouldn't matter where the placement of things are as the function doesnt do anything.

I guess thats the easiest option. And then redesign for the next watch.
Which now makes me realise why there was very little difference in the latest watch releases as perhaps apple haven't quite finished the new design so just tweaked the old one to get through this period. I expect brand new Apple Watches to be released earlier than normal next year.

For Apple, the principal would be bad to let any company beat them, right or wrong, because its just encourages more companies to try it. Tim will always be willing to cut a deal, but it has to make sense. He's not going to buy a 6b company he doesnt need to put in a $1 oxygen meter that;s barely accurate anyways. Sounds bonkers.

 

[Zest28]

Actually now that I think about it again. Apple can increase the price of the Series 9 and Ultra 2 by $100 and blame it on Masino.

And then for the Apple Series X and Apple Watch Ultra 3, Apple will use a different oxygen monitor but keep the prices the same, which increases the profit margins for Apple for many years to come.

This could be the best play for Apple actually.

 

[laptech]

As far as I understand this is to halt sales before they even get to court right? So Apple hasn't been found to infringe anything, but an injunction is being used as a weapon to force apple to pay up ($100?) or even buy them.

I'm guessing that even if the patent is about hardware, the solution has to perform its full function to be found to infringe right? So if Apple just disabled the monitor on US watches it wouldn't matter where the placement of things are as the function doesnt do anything.

I guess thats the easiest option. And then redesign for the next watch.
Which now makes me realise why there was very little difference in the latest watch releases as perhaps apple haven't quite finished the new design so just tweaked the old one to get through this period. I expect brand new Apple Watches to be released earlier than normal next year.

For Apple, the principal would be bad to let any company beat them, right or wrong, because its just encourages more companies to try it. Tim will always be willing to cut a deal, but it has to make sense. He's not going to buy a 6b company he doesnt need to put in a $1 oxygen meter that;s barely accurate anyways. Sounds bonkers.

I believe that is what the outcome will be if Apple refuses to deal with Masimo, they will just put a software block on the function that will disable the hardware from being able to be used. This goes on all the time with technology. One hardware with all functions but then some functions are disabled via software depending on a countries requirements.

If that turned out to be the outcome, the ban would only affect imports of US watches. Therefore how would this affect international owners of the watch travelling to the US, would they be allowed to bring their watch into the country? hypothetically speaking of course.

 

[threesixty360]

I believe that is what the outcome will be if Apple refuses to deal with Masimo, they will just put a software block on the function that will disable the hardware from being able to be used. This goes on all the time with technology. One hardware with all functions but then some functions are disabled via software depending on a countries requirements.

If that turned out to be the outcome, the ban would only affect imports of US watches. Therefore how would this affect international owners of the watch travelling to the US, would they be allowed to bring their watch into the country? hypothetically speaking of course.

I bought a series-4 watch in Japan a few years back. The ECG thing took about 3yrs before it got approved in the Japan region so even though I was back in the UK, it didn't work until that was sorted out. So I expect only watches bought in the US (they all have region codes) will have the functionality removed. It won't affect anyone else.

 

[Zest28]

Seems that Masino is doing some copying themselves. Seems they are heavily inspired by the Apple Watch.

Also an other question, who was the first to use this sensor in a smartwatch. If Apple was first to use this sensor in a smartwatch, Apple can also hit back with this.

 

[Zest28]

What I could find on Google, this smart watch by Masino was released in the end of 2022. So Masino definitely stole the idea of using their sensor in a smartwatch from Apple. Because Apple was doing this since the Apple Watch Series 6.

Masino are not so clean themselves.

 

[Alexfromaz]

FINALLY! Some juicy drama since the Adobe/Flash war in 2010 🤣⚔️

 

[arobert3434]

Problem is easily solved by buying Masimo.

Might be cheaper to, you know, license the technology though?

 

[CarAnalogy]

To be fair, Apple and this company are not competitors. Apple makes sports watches and this company makes medical equipment.

Which doctor will seriously use an Apple Watch to check the health of his patient? If you see a doctor doing this, run away as fast as you can.

Apple says the idea is you use the watch to keep track of data on your own, then bring those records to the doctor for some context along with proper medical readings.

That said, I’ve yet to see any doctor who was aware of this.