Google Muscles Up With Fitbit Deal Amid Antitrust Concerns

2021-01-15 10:04:56

Google Shores Up Fitbit Deal Amid Antitrust Concerns

Thursday’s completion of the acquisition comes 14 months after Google announced a deal.

Google has completed its $2.1 billion acquisition of fitness-gadget maker Fitbit — a deal that could help the Internet company grow even stronger while US government regulators pursue an antitrust case aimed at undermining its power.

In India, Fitbit users who used its subscription service — Fitbit Premium, were also given a reduced subscription price, down to Rs 1,000 from close to Rs 7,000.

As per an IDC report, Fitbit is considered the fifth largest wearable company in shipments as of 2019 with a 14.8 per year-over-year growth, behind Xiaomi and Apple. Fitbit claims to have sold more than 100 million devices and have 28 million users.

Thursday’s completion of the acquisition comes 14 months after Google announced a deal that immediately raised alarms.

Google makes most of its money by selling ads based on information it collects about its billions of users’ interests and whereabouts. Privacy watchdogs feared it might exploit Fitbit to peer even deeper into people’s lives.

But Google wound up entering into a series of commitments in Europe and other parts of the world pledging it won’t use the health and fitness data from Fitbit’s 29 million users to sell more ads. It insists it is more interested in adding Fitbit to its expanding arsenal of Internet-connected products, which include smartphones, laptops, speakers, cameras and thermostats.

“This deal has always been about devices, not data, and we’ve been clear since the beginning that we will protect Fitbit users’ privacy,” Rick Osterloh, Google’s senior vice president of devices and services, wrote in a Thursday blog post.

Google is scooping up Fitbit — a company that has sold about 120 million devices in 100 countries since its 2009 founding — while it fights a series of lawsuits filed by the US Department of Justice and state attorneys general. The lawsuits allege Google abuses the power that it has amassed as the owner of the world’s most dominant search engine. The Justice Department’s lawsuit isn’t scheduled to go to trial until September 2023.

Since starting out with nothing more than its namesake search engine in 1998, Google has become a dominant player in email, digital maps, web browsing and mobile devices through its Android operating system. The success of those free services propels a digital advertising empire and is the main reason Google’s corporate parent, Mountain View, California-based Alphabet Inc., boasts a market value of nearly $1.2 trillion.


The US Justice Department had until January 13 to object to the Fitbit deal, but didn’t file a formal objection. The agency didn’t immediately respond to a request for comment Thursday.

Google said it is ready to answer any further questions the Justice Department has about its Fitbit deal.

“We are confident this deal with increase competition,” the company said in a statement.

Fitbit’s 29 million users’ privacy will continue to be protected as per Google’s agreement with international regulators.

“Google will continue to protect Fitbit users’ privacy and has made a series of binding commitments with global regulators, confirming that Fitbit users’ health and wellness data won’t be used for Google ads and this data will be kept separate from other Google ad data,” James Park, Fitbit’s CEO and co-founder, said in an email to users.

This means that the wearables maker’s users can continue to connect with third-party services. They can also link their device account with other health and wellness apps.

Park also noted that “putting your health and wellness at the center of everything we do and to offering a no-one-size-fits-all approach with choices that work across both Android and iOS.”

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