Following a ruling from a trade court, Apple Watches may soon be prohibited from being imported into the US, turning the popular wearables into collectibles after the holidays. But what are the reasons tiggering this Apple Watch ban?
A ‘limited exclusion order’ was issued by the US International Trade Commission last week on a few Apple Watch models, which will eventually prevent imports of smartwatches.
On the 26th of December, there will be no more sales of Apple Watches, and an import ban will be imposed. Counterpoint Research estimates that Apple Watches account for 60% of the smartwatch market.
President Joe Biden could stop the ban, which would reduce Apple’s projected annual watch revenue of $14 billion to $18 billion, but doing so would be an uncommon move to overturn the trade court’s ruling.
A ruling from January, which found Apple had infringed upon Masimo’s patent on light-based technology for reading biomarkers like blood oxygen levels, was upheld by the trade court.
Apple will be forced by the ruling to discontinue selling watches on Christmas, apart from the SE model.
‘[The] ruling by the USITC sends a powerful message that even the world’s largest company is not above the law,’ said Joe Kiani, Founder, Chairman, and CEO of Masimo, in a statement.
‘This important determination is a strong validation of our efforts to hold Apple accountable for unlawfully misappropriating our patented technology.’
U.S. – Chinese Relationship
The iPhone parent has stated that it respects the intellectual property of other businesses and has refuted Masimo’s allegations. Global medical technology company Masimo initially filed a complaint in 2021.
Patent infringement issues raised by Masimo could lead to many factors that would affect American – Chinese relationships on two levels, geopolitical and technological standpoints. The straining of relationships could lead to numerous disputes. This could catalyze the process regarding the fact that the U.S. is finding an alternative for China, which is India. The U.S. government could impose tariffs on China. A problem on trade would be issued, partnerships between both countries would end, and highly affect political relationships.
Although Apple Watch is an American-based idea and product, it is assembled in China. If the ban takes place, this will affect the production of the smart wearable. Trade relationships in this case can arise between the U.S. and China. At the moment, China has the power to impose its own restrictions, which would affect the trade technology relationship between the two countries.
The New York Times reported that Masimo claimed Apple purposefully recruited over 20 workers from the rival company rather than purchasing a license for the technology.
Protection of Intellectual Property
There are many challenges that Apple is facing in the field of protecting its property via patents and other security measures regarding its brand identity. Worldwide competitors strive to copy and achieve what Apple products are achieving. For Apple to keep going at the rate it is, they must comply with U.S. trade policies. The giant was unable to reach a unanimous verdict.
Apple will have to stop selling all watches on Christmas, except for the SE model, according to the trade court’s decision. A settlement could be reached that would permit Apple to utilize the technology.
President Biden could intervene and overturn the decision, but The Times pointed out that Presidents hardly ever overrule impartial agencies.
According to Business of Apps, Apple’s watch sales as part of its wearable and accessory division generated between $14 billion and $18 billion in revenue in 2022.
Will this issue fuel an American vs. American… vs. Chinese tech war?
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