Google had planned to acquire Fit Bit a few months back for the amount of $2.1 billion and now the plans seem to have hit a hurdle but are still in motion. The scrutiny that Google is facing at the moment is expected when a huge company acquires another. The finalization of the deal is hence yet to be done as the EU is currently investigating the matter.
The announcement of the plan that Fit Bit would come under Google had already been done by the company in November last year. All the regulatory scrutiny that has come after it is very much expected given it wouldn’t be the first time that the EU is stepping into a matter like this.
As it has come from various sources that have been involved in the matter, an antitrust investigation from the EU’s end is what has kept the deal between the two companies from being finalized. Google has been asked to make a few concessions to ensure that the acquisition goes on smoothly from that point.
The main concern around the acquisition of Fit Bit seems to be around the health records of users. A lot of information on users’ health is collected by any company like Fit Bit and the matter of health privacy has become a hurdle in the deal being sealed with Google.
It is also understandable that Google itself is a company working in the technology and data sector where they deal with such data every day. A proper agreement between the two companies could be based on the promise that the data acquired from Fit Bit won’t be something put forward for selling ads.
Gaining access to Fit Bit’s data also has advantages of its own for Google. It would give way to Google to work on the data and move forward with ways to mine it. Many have criticized this aspect of the deal.
The hold on the acquisition comes from whether Google would succeed to keep the promise made when the deal was announced. The company’s head of hardware Rick Osterloh has said back then, “Privacy and security are paramount. When you use our products, you’re trusting Google with your information.”
It has also been reported by the company recently that competition is bound to go up once they acquire Fit Bit. There are already key players in the industry, including Apple, Xiaomi, and Huawei. Even though Fit Bit has a good enough market of its own but it would take some labor to work the brand up the ladder as it came into the smartwatch market much later.
Another spokesperson from Google has spoken to address all the speculation around regulatory fears, by saying “Throughout this process, we have been clear about our commitment not to use Fitbit health and wellness data for Google ads”
For now, Google has until 13th July to present any concessions it might be offering and the regulators will finally decide on the acquisition on 20th July 2020.
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