According to The Verge , Apple has developed a software solution that modifies the SpO2 measurement app and algorithms on the Apple Watch in a way that avoids violating Masimo's patents without losing functionality on the product. But if Apple's appeal of the US International Trade Commission's (ITC) decision is unsuccessful, the company will be forced to remove the feature entirely.

The case stems from a patent infringement complaint filed by Masimo, a company that sells fitness and health-focused medical devices, which it filed in 2021. Masimo claims Apple infringed on its patent for a light-based blood oxygen sensor it used in its latest Apple Watch models, which affected Apple Watch sales last Christmas before a US appeals court granted Apple a temporary reprieve.

In preparation for the worst-case scenario of an unsuccessful appeal, the company’s executive team has reportedly begun shipping modified Apple Watch Series 9 and Watch Ultra 2 to retail stores in the US. These are likely new versions without the SpO2 measurement function, meaning they do not infringe on Masimo’s patents.

The removal of the SpO2 measurement capability on the Apple Watch is seen as a major blow to Apple because it is an important tool for monitoring users' health, and removing it will affect customer demand for the product. In a note sent to investors, Bloomberg analyst Tamlin Bason said: "Apple may have paid a heavy price to get around the ITC import ban. It was a highly promoted feature."

For Masimo, the company said in its statement that Apple's redesign of its smartwatch to not include the SpO2 measurement feature was a positive step toward its responsibility. "It is critically important that one of the world's largest and most powerful companies respect the intellectual property rights of smaller companies and comply with the ITC's order when it is found to have infringed," Masimo said.