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Comment by hasty_pudding | Hacker News Reader

Why doesn't Apple enter into a deal with Masimo for a small percentage of the watch? Unless I missed it, the news article didn't go into more detail on why a deal couldn't be made.

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There was another article with this quote[0]:

> “If they don’t want to use our chip, I’ll work with them to make their product good,” Mr. Kiani said. “Once it’s good enough, I’m happy to give them a license.”

It sounds like they didn't just want some money. They wanted them to use their chip or partner with them.

I am no Apple fan, but telling them to politely fuck off seems reasonable to me.

[0] https://www.nytimes.com/2023/12/18/technology/apple-ban-watc...

The way I read this is, Masimo does not have confidence in the way Apple has implemented the technology and they don't want their name attached to a bad implementation.

So they are giving Apple the choice of either buying a turnkey solution or partner with them to fix Apple's flawed implementation.

Yeah, and I think that's bullshit. If the implementation is so bad, then how is it infringing on the patent?

You can't have it both ways in my opinion. I hope they go to court and lose.

Ah thanks for the info, That makes a lot of sense.

That would be the obvious solution, but it’s not surprising they couldn’t agree on a price when they operate in very different industries. Masimo makes medical devices, ones whose prices are probably both high and skewed by insurance. Apple is a consumer devices company and may not be able to justify a high royalty price and still meet certain consumer price points. Another possibility is that Apple’s watches may be an alternative to Masimo’s expensive, high-margin devices, so a licensing deal could destroy Masimo’s entire business in the long run. So, coming to an agreement on price may have been impossible.

If Apple could destroy this company's business, it's a good thing they have a patent preventing that.

> Apple is a consumer devices company and may not be able to justify a high royalty price and still meet certain consumer price points.

Do we know the total BOM cost plus the amortized cost of development & other expenses for an Apple watch ?

While I don't think one patent holder should get a major share of the available margins, I find it hard to believe that margins for Apple on smart watches are anywhere close to "thin".

Apple isn’t going to go into medical devices that are certified for diagnostic use unless they’re nuts. There’s a lot of money there, but it’s hard to get and way outside their core businesses.

That $8 pulse oximeter from aliexpress is better than nothing, but it’s a long way from what Masimo or Medtronic (Nellcor) sell.

And the prices for oximeters aren’t really affected by insurance, as individuals almost never get them at diagnostic grade. They’re durable, have screens that convey more than just a number, electrically isolated from the patient… there’s a lot going on there that is not, at first glance, obvious to the layman.

(I’m an anesthesiologist; pulse oximetry with a good waveform display is a critical monitor for us. I would rather have a good pulse ox than any other non-invasive monitor, if I could only have one.)

This such an interesting thread.

Thanks for the info.

This is great info.

As a follow-up, it looks like Masimo is trying to make a consumer watch-like device (or possibly just pretending to so they look like a competitor to Apple). https://www.masimopersonalhealth.com/

Thanks, good points

Maybe Masimo isn’t offering a deal for an acceptably small amount.

Probably because, since Masimo has Apple over a barrel, they want a large percentage of the watch.

Your best bet would be to follow the court filings and look for the words "unwilling licensor" and "unwilling licensee".

Though I suspect this is more on Apple. Going to be blunt for a bit, but Apple has a habit of assuming only it produces innovation worth paying for. Apple usually doesn't wind up actually taking the import ban in the end, but there's a whole host of patent litigation that has targeted Apple. It's kind of funny, though - I remember the days where Steve Jobs insisted that them owning a swipe-to-unlock patent meant basically any phone with a touchscreen and a not-ass operating system was infringing them. "Zero-length swipe" my ass.

Probably would cost them more than waiting them out in court, or would encourage or make it easier for other patent holders, however legitimate, to go after them.

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