Apple will cease selling smartwatches in its own US stores by Christmas, after losing a case of patent infringement. This is a major blow to the company during the holiday season.
Sales of Apple Watch Series 9 and Ultra 2 will be stopped in the US on December 21 online and after December 24 in stores.
The US International Trade Commission had issued a “limited inclusion order” in October against the products, threatening to ban imports.
A US judge ruled that Apple’s new watches broke patents held by medical device maker Masimo due to the blood oxygen sensor.Apple has appealed the ITC decision while it awaits the result of the presidential review by Joe Biden who can veto this ban.
In 2013, President Barack Obama intervened on behalf of Apple after it lost an ITC lawsuit against Samsung.
The review period for the presidential order ends on December 25, and devices are still available from other US retailers until then. The ITC ruling does not affect sales in other countries.
If Biden’s team succeeds and Apple’s appeals are unsuccessful, Apple might have to change its software to recover its sales.
Apple said that it strongly disagrees and has pursued a number of legal and technological options to make Apple Watch available to its customers. Apple said that if the order is upheld, it will continue to take every measure to get Apple Watch Series 9 or Apple Watch Ultra 2 back to US customers as quickly as possible.
Joe Kiani, the CEO of Masimo, said in October that the ITC ruling “sends an important message that not even the largest company in the world is above the law.”Apple sued Masimo last year for infringement of its patents.
Masimo stated on Monday that the ITC had undertaken a thorough legal procedure and that its expert opinion in this matter must be respected. This will protect intellectual property rights, and maintain public confidence in the United States patent system.
Apple is also involved in a legal dispute over smartwatches with AliveCor, another medical device manufacturer.
Apple shares, which reached all-time highs just last week, fell by 0.85 percent on Monday.
Apple is the top smartwatch manufacturer globally, holding about 22% of the market share in the third quarter, as per Counterpoint Research.
In an effort to maintain consumer interest, the company adds new and more advanced health monitoring features each year. Over the last year, many shoppers have reduced their spending on expensive tech accessories.
Apple’s success is dependent on selling accessories to iPhone users, such as the Apple Watch or AirPods headphones. The smartphone market has been in decline for some time. Canalys market research predicts that smartphone unit shipments will decrease by 5 percent in 2023, following a 12-percent decline in 2022.
Apple’s wearable tech range is expected to be a standout next year, when it releases Vision Pro. It will be the company’s first “mixed-reality” headset and the most important development since Tim Cook became CEO after Steve Jobs.