Google Proceeds With Fitbit Deal, But Government Reviews Continue-- Update
By Dave Sebastian
Google said it has completed its $2.1 billion acquisition of
Fitbit Inc., a deal that would let the search giant push more
deeply into the wearable-device and health-data businesses, as it
continues to face antitrust scrutiny.
The announcement on the deal closing came after European Union
antitrust officials last month approved the acquisition with
conditions aimed at protecting users' health data and preserving
competition in the wearable-tech sector, clearing one of the deal's
hurdles. But other antitrust agencies are continuing to scrutinize
the transaction, including in the U.S., meaning Google's decision
to move forward isn't without regulatory risk.
"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 for devices
and services, said Thursday.
To appease EU regulators, Google pledged not to use Fitbit data
for advertising purposes in Europe and to store such data separate
from any other Google data used in ads.
It also told regulators it would allow users to link their
Fitbit data to competing apps and committed to allowing
wearable-device makers open access to functions of Google's Android
Google, an Alphabet Inc. company, had offered concessions as
part of the EU's investigation into the deal, which the bloc opened
in August after rejecting Google's initial commitments as
Fitbit, founded in 2007, makes so-called wearables, or watches
and bracelets that primarily track health information like heart
rate. The Fitbit deal, first agreed to in November 2019, remains
under review by the U.S. Justice Department and Australia's
competition authority. The move intensifies the battle among
technology giants in enticing consumers through devices other than
In response to Google's announcement, the U.S. Justice
Department issued a statement emphasizing that its work on the
transaction isn't done.
"The Antitrust Division's investigation of Google's acquisition
of Fitbit remains ongoing," department lawyer Alex Okuliar said.
"Although the Division has not reached a final decision about
whether to pursue an enforcement action, the Division continues to
investigate whether Google's acquisition of Fitbit may harm
competition and consumers in the United States."
In Australia, where the competition authority has rejected
Google's proposed moves to address competition concerns, the
company is awaiting a decision on March 25.
The Australian Competition and Consumer Commission "continues to
have concerns that Google's acquisition of Fitbit may result in
Fitbit's rivals, other than Apple, being squeezed out of the
wearables market, as they are reliant on Google's Android system
and other Google services to make their devices work effectively,"
Rod Sims, who chairs the commission, said in December.
A Google spokeswoman said the DOJ allowed the deal to close, and
that the company will continue to engage with Australian
Write to Dave Sebastian at email@example.com
(END) Dow Jones Newswires
January 14, 2021 12:18 ET (17:18 GMT)
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