Google is planning to purchase the wearable fitness tracker company FitBit for $2.1 billion, according to BBC News. With the acquisition, Google will now compete directly with Apple and other wearable technology companies, and will gain access to detailed health data from millions of FitBit users.
“With Google’s resources and global platform, Fitbit will be able to accelerate innovation in the wearables category, scale faster and make health even more accessible to everyone,” according to co-founder and CEO James Park. “Google is an ideal partner to advance our mission.”
FitBit was an early entrant into the wearable technology market, but has struggled as more competitors have established themselves, and was put up for sale last month. FitBit shares have surged 40 percent in value since Google’s interest was reported early last week.
For Google, which has struggled to gain a foothold in the wearable hardware market, the move could create new opportunities. The purchase could give them a chance to develop Wear OS, their own wearable tech operating system. But controversially, and perhaps most importantly, it will give them access to health and fitness data from FitBit’s 28 million users.
Some analysts and observers have suggested that acquiring the data was likely a central motivation for Google, which agreed to pay $2.1 billion for FitBit, which had a market value of just $1.4 billion last week. But Google, along with other tech giants, has increasingly come under fire for privacy issues in recent years.
When the deal was first reported, the UK’s Labour Party called on the nation’s antitrust authorities to step in and investigate.
“This is not just a business deal, it’s a data grab – and that should worry us all. Any such proposal must be subjected to the most rigorous possible scrutiny and must be fully investigated by the CMA,” Tom Watson, the shadow digital, culture, media and sport secretary, wrote to the Competition and Markets Authority.
Watson warned that data on “how we sleep, when we move, what we eat, on our breathing and our heartbeats” would be transferred to a company that relies on micro-targeted advertising for its business model.
Both companies have been careful to address privacy concerns. Rick Osterloh, Senior Vice President of Devices and Services for Google, said in a press release:
“We will be transparent about data we collect and why. We will never sell personal information to anyone. Fitbit health and wellness data will not be used for Google ads. And we will give Fitbit users the choice to review, move, or delete their data.”
And FitBit’s own announcement of the deal stated:
“Fitbit will continue to put users in control of their data and will remain transparent about the data it collects and why. The company never sells personal information, and Fitbit health and wellness data will not be used for Google ads.”
But it’s unclear if these assurances will be enough for users, who have already voiced privacy concerns, or for regulators. Barring any regulatory hurdles, the acquisition would be completed in 2020.
Photo Image by FitNishMedia from Pixabay
Did you like it? 4.5/5 (27)
