European Commission probes Google’s Fitbit acquisition

The European Commission has opened an investigation to see whether Google’s $2.1 billion acquisition of Fitbit is fair game under competition and merger rules.

Google announced it was purchasing Fitbit during November 2019, though there have been plenty of voices of dissent. Google already knows a lot about its users, but it seems accessing data on movements and health is a step too far for some.

For different reasons, it might also be an acquisition which falls foul of the European Commission.

“The use of wearable devices by European consumers is expected to grow significantly in the coming years,” said European Commission Executive Vice-President Margrethe Vestager.

“This will go hand in hand with an exponential growth of data generated through these devices. This data provides key insights about the life and the health situation of the users of these devices. Our investigation aims to ensure that control by Google over data collected through wearable devices as a result of the transaction does not distort competition.”

Vestager has been a competition champion for the European Commission in recent years, regularly placing Silicon Valley’s resident under the antitrust microscope. This is another move which suggests Brussels is not particularly welcoming of the all-powerful internet giants.

There are several elements to this investigation. Firstly, as Google is already in a dominant position when it comes to digital advertising, the Commission will aim to understand whether this will tilt the favour too far.

Secondly, with the health tech industry still in its embryonic days, the question as to whether it is healthy for such a powerful and aggressive company to dominate is open to interpretation. Some might suggest smaller companies are at risk of being squeezed too tight before the industry has had a chance to develop.

Finally, the Commission will aim to understand whether a link-up between Google and Fitbit would put other wearable manufacturers in undo risk, as there is potential for the Android OS to be used to inhibit these companies.

The Commission now has 90 days to conduct its investigation. This did look to be a very attractive acquisition for Google, both in terms of expanding the Wear OS footprint and offering Google more traction in the health tech sector, but worry might appear as the privacy and competition sensitive European Commission probes.

Leave a comment

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.