Apple is in trouble as they are no longer allowed to sell their latest models of watch bands namely, the Apple Watch Series 9 and Apple Watch Ultra 2 in the USA because of the recent ban by the International Trade Commission. The sale has already halted from its website as of December 21st and its retail stores will also stop selling the two models by the 24th of December. This is a major setback to Apple, especially during the time of Christmas when Apple could make the biggest revenue hit.
So, let’s dive into the issue and figure out what are its consequences, and most importantly how is it going to impact you.
Also Read: Apple Watch Series 10: Price, Features, And Other Details
Why Is the Apple Watch Banned?
The US International Trade Commission recently imposed a ban on two of the latest models of Apple watch bands namely, the Series 9 and Ultra 2 in the USA. The decision was made in response to a patent battle with Masimo Corp., a health technology business, over a critical component of these watches: the blood oxygen measurement technology.
Masimo Corp. is a medical device company that sells its own health and wellness wearable products. It is mainly known for its Pulse Oximetry technology, a way of measuring oxygen levels in the blood. Apple Watch has used this feature since 2020 on the back of Apple Watches that help consumers know their blood oxygen levels.
Consequently, ITC, in January 2023 found out that Apple infringed the patent rights of Masimo by using the Pulse Oximetry technology, and as a result, these Apple Watch models were banned from being imported, which had a direct impact on Apple’s sales in the US market.
This is bad news for Apple as watch sales in the year 2022 hit $52 million. This decision affects not just Apple but also its global network of suppliers that produce and assemble its components as the Apple Watch is a massive player in the wearable market as a whole with Apple selling more watches than the entire Swiss Watch industry at over 15.4 million units.
Impact of the Ban
The ban does not only impact the sale of Apple Watches but it also has many other impacts that are a matter of concern for Apple Watch users. It includes preventing the repairing of other watch models, pulling out the online sale of the latest smartwatches, and financial implications on the markets of different countries.
Let us discuss all the major impacts in detail below.
1. Preventing Repairs of Out-of-Warranty models
This recent ban might affect the existing Apple Watch users. Apple stated in a memo sent this week to its customer support staff that it will no longer be fixing out-of-warranty Apple Watch Series 6 products. With the new modifications, Apple will no longer be able to repair older iPhones’ hardware; however, the company will still be able to assist customers with software-related concerns. This implies that you will not be able to get an Apple Watch with a blood oxygen sensor that is out of warranty — serviced, repaired, or replaced in any way. For example, Apple will not be able to assist you in any way if the screen on your Apple Watch Series 6 is broken.
Additionally, Apple won’t be able to exchange a watch that is purchased even before the ban. It can only be returned or refunded. This means that anyone who receives an Apple Watch for Christmas cannot exchange it for a new model if they need a different size or colour, which seems particularly disappointing for Apple and their customers.
2. Impact on the Online Sales of Apple
The ban on the Apple Watch Series 9 and Ultra 2 could have an impact on Apple’s product strategy, as both watches are crucial to the company. The ban may cause Apple to shift its focus to other products, such as the Apple Watch SE, which is unaffected by the ban. Concerns have been raised about the ban’s potential impact on iPhone sales. The ban might have an impact on Apple’s overall sales and profits, especially given the popularity of the impacted models.
3. Impact on the Consumers in USA
Consumers in the USA will be impacted the most as Apple has already suspended its sales and services in the country. To biggest downside is that people cannot gift the latest model of Apple Watches to their loved ones on Christmas. However, there are no restrictions on use for customers who purchased the impacted models before the ban’s adoption, and Apple’s warranty services continue to operate normally, ensuring that devices inside the warranty term can still undergo servicing.
Only the new users are going to suffer because of the unavailability of these products both online as well as offline. However, some third-party retailers like Target Corp., Walmart Inc., and Best Buy Co. can continue selling the smartphone despite the ITC restriction because it only affects Apple’s direct sales channels.
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4. Impact on the Consumers in India
The impact of the ban in India is minimal. ITC only bans the sale of these models in the USA. In India, Apple Watch Series 9 and Ultra 2 are available and continue to remain on sale. However, it might affect the import of some Apple Watch models, including the Series 6, 7, 8, and Ultra models, as well as the current Series 9 and Ultra 2, which possess the blood oxygen feature. However, the major impacts of the ban on other countries except the USA are yet to be determined. But most likely if the issue is not resolved in a few weeks then this ban would result in suspending sales of these two Apple Watches in India as well.
What can Apple do now?
To prevent the ban on the Apple Watch, Apple is taking several measures. The Biden administration is “tracking” the US Trade Representative’s potential veto over the decision to ban almost all Apple Watch sales in the US owing to the patent issue. However, the ban is scheduled to take effect on December 26, 2023, and the White House has not yet stepped in.
To resolve the matter, Apple is looking into several options, including possible settlements and licencing deals with Masimo. If possible, the corporation is also thinking about changing the software to get around the ban. Given the popularity of the impacted models, it is anticipated that the ban will have some effect on Apple’s overall sales if it does go into force.
Also Read: Apple Watch: Why Is It So Far Ahead of Wear OS
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