EXCLUSIVE: Why Masimo Aquired Sound United & Where They Are Going In The Marriage Of Medical Technology & Audio

When Sound United, one of the world’s leading audio Companies, was acquired last year by US medical Company Masimo, one question stood out. Why?!

After acquiring Sound United for $1.4 billion, investors initially appeared puzzled about the acquisition, and at CES we sought to find answers.

I caught up with Nick Adams, Vice President of Strategy, Masimo Consumer at Sound United, in an effort to get some answers from a Company that has already delivered a big body blow against Apple, and who stood accused of stealing Apple medical patents.

Recently Masimo moved to roll out a software upgrade that will enable millions of Sound United home entertainment systems spanning Denon, Marantz and Bowers & Wilkins products to collect, share and display health information, a move that links Sound United’s traditional products with a new world of health care information.

They are also set to take on Apple’s Watch, which has been described as more ‘Swiss Army Knife” that does 5 per cent of everything over a new Masimo watch that delivers 100 per cent proven hospital grade medical and fitness data.

Adams says, “We believe that there is a void left that their products can’t fulfill (accurate and continuous health monitoring). We see a huge market, with a portion of the target audience that currently isn’t being “satisfied” by brands such as Apple and Samsung.

What Adams outlined spanned the relaunch of new products for Polk in the youth market, the possible reintroduction of the Boston Acoustics brand, the expansion of the Company’s Denon products in the affordable premium market, and the expansion of the Bowers & Wilkins and Marantz brands with the introduction of new medical-grade hearing technology.

They are also set to take on Apple with a “real health and fitness” watch that could save Australian hospitals millions of dollars by delivering faster turnover of beds, while giving hospital patients confidence that their health is being monitored 24/7 when they leave a hospital bed.

What is coming to the Australian market is “Medical grade consumer health devices for consumers” from a leading medical Company that already works with some of the biggest US hospitals.

Retailers and the specialist audio channel will see Sound United HEOS software play a roll by making information available via a multitude of devices, including the Company’s AVR range of Marantz products, right through to new hearing technology currently being bult into premium Sound United headphones.

Currently, there are 4 million, Sound United HEOS systems worldwide.

Recently, Sound United moved to upgrade 20,000 HEOS Denon Home devices and Masimo Home Health Hubs in the US.

This year, the software activation will expand to a total of 4 million HEOS-enabled premium devices from Denon, Marantz and Definitive Technology.

The software upgrade enables the HEOS platform to provide an always-on connection to the Masimo Health secure cloud. In addition, home entertainment systems with HEOS can aggregate, record and display health data from the company’s wearable health and wellness devices.

Soon, and subject to regulatory approval, consumers will be able to get a Masimo watch in Australia that is currently selling in the US market for US$500. Also coming is Masimo Adaptive acoustic technology that is set to be built into Sound United headphones such as the popular Bowers & Wilkins cans.

“Masio’s strength is in signal processing and what our adaptive acoustic technology does is basically map your ear. It will then personalise what you’re hearing to your ear.” Adams said.

“Leveraging Masimo’s clinically proven monitoring technologies, alongside the state-of-the-art engineering and reach of the HEOS technology platform, we plan to transform existing healthcare, safety and entertainment paradigms to improve life in the hospital and in the home.”

Currently, Masimo has a host of devices tracking health metrics. The W1 health tracking watch is just one product.
There is also a SafetyNet patient management system with Radius PPG and Radius T° sensors. The idea is that Sound United gear can could wirelessly relay data to the HEOS and Masimo Health cloud for storage, analysis, reporting and transfer.

In addition, they will make the data available via in-home displays and apps, alongside customisable notifications and reminders.

A person with Masimo health trackers and a HEOS could move throughout their home with continuous access to a wide range of health metrics.

“Think oxygen saturation, pulse rate, respiration rate, hydration, temperature, and more. Plus, the HEOS with Masimo Cloud could help host telehealth sessions from home, streamlining data transfer to clinicians,” Adams said

He added, “There are a lot of tech players out there who are trying to get into health care. Apple and Samsung among them. We are a health care monitoring Company with extensive knowledge of health care and monitoring and signal processing, who are now getting into the audio market, there is a bit of reverse play here and this gives us an advantage because of our expertise. What we are delivering into the consumer space is hospital-grade technology.”

As an example, he cited the Apple watch.

“This device does so many things. From measuring your heart rate, sending a text message and measure oxygen levels. Our watch will be able to do many of those thing but the big difference is our primary objective is health care and monitoring. Apple is 5 per cent of everything, where we are 100 per cent of hospital-grade health measurement.”

He cited recent independent tests relating to blood oxygen measurement. “The Apple watch only managed a rating of 4/60 while the Masio watch achieved a rating of 60/60,” he said.

Masimo sued Apple in 2020, claiming the iPhone maker had stolen its trade secrets and infringed its patents, including for measuring heart rate and blood-oxygen levels. Last year, it also asked the US government to halt imports of Apple Watches that violate its patents, with that court case still pending.

Recently, a US Court ruled that Apple Watch technology, owned by Sound United parent Company Masimo, was stolen by Former Masimo Chief Technical Officer Dr Marcelo Lamegoa.

Now, Apple CEO Tim Cook is fighting having to appear in court to explain his involvement in the theft of Masimo health patents.

The battle between the two companies has a long history. Back in 2013, Apple reportedly contacted Masimo to discuss a potential collaboration between the two Companies.

Instead, claims Masimo, Apple used the meetings to identify staff it wanted to poach.

Masimo later called the meetings a “targeted effort to obtain information and expertise”.

Apple did indeed hire a number of Masimo staff, including the Company’s chief medical officer, ahead of the launch of the Apple Watch.

Masimo CEO Joe Joe Kiani later expressed concern that Apple may have been trying to steal the company’s blood oxygen sensor technology. The company describes itself as “The inventors of modern pulse oximeters,” and its tech is used in many hospitals.

At this point, Sound United in Australia is still working on how to take the Masimo watch to market.

In the Sound United product market, Masimo has a silo management practise, with each division run by its own Vice President and individual management team.

Currently, the business is looking to shift their health management knowledge expertise into audio products.

Adams said that, “Masimo AAT will initially be deployed in Denon products first, and it is to be decided how AAT will deployed in B&W. We have recently seen great success with the Bowers & Wilkins headphones (PX7 S2 and PX8 launched), as well as the Denon TWS launch in December 2021.

“Even before the acquisition of Sound United we were looking to move even further up-market with our audio products while looking to grow share with a younger youth market. We now believe that the Masimo AAT technology can be used to put headphones on steroids in the future.

“We are also working on our partnerships with Bond 007 and Maclaren and you will see a lot more marketing in the future around these investments.”

When it was put to Adams that the specialist audio channel was suffering from a lack of marketing and were living off old traditional customers vs a new generation of customer ,he said that a lot of change was coming at Sound United.

“We are turning all our AVRs into health hubs. We are expanding the Polk brand and we are delivering new capabilities for Sound United products

“Consumers will be able to collect data via the AVR in their home coming from a Masimo measuring device, whether it’s a watch or finger sensor. This will evolve the purpose of owning an AVR”. He claims.

As for the value and youth market, Adams said the business is currently working on new Polk products in a move that could see them not only taking on Klipsch but the Harman owned JBL. Among the products coming are new Polk soundbars, and in the affordable premium market Sound United are looking to take on Sonos with new networked audio products.

Adams even admitted that in the premium top-end audio market the Company is looking at new networked products spanning Bowers & Wilkins and Marantz, that deliver premium sound using a new generation of chipsets and software from the likes of Dolby.