EU antitrust enforcement agencies plan to launch a full investigation into Google’s acquisition of Fitbit unless it can make concessions to address EU concerns, people familiar with the matter said today. To allay the EU’s concerns, Google needs to build on last year’s commitments and make further binding commitments. Google promised last year not to use Fitbit’s health data in its ads.
In November, wearables maker Fitbit announced that it had signed a final deal with Google to buy Fitbit for $7.35 a share in cash, valuing it at $2.1 billion.
In February, the European Data Protection Commission warned that the deal could pose privacy risks for users. Fitbit’s fitness tracker monitors data such as daily steps, calories burned and distance, and google will get a lot of its user health data when it buys Fitbit. The European Data Protection Commission considers this to be a worrying situation.
In May, BEUC, a European consumer group, also said Google’s acquisition of Fitbit could hurt consumers and hinder innovation. In addition, BEUC said the deal would change the rules of the game in the digital health market.
In June, Google began seeking EU approval for the deal, according to a document published on the European Commission’s website. EU regulators are understood to have sent a 60-page questionnaire to Google and Fitbit’s respective rivals asking them to assess how the acquisition will affect the digital healthcare sector, whether it will adversely affect fitness tracking apps in Google’s app store, and how Google will use the user data in its search and advertising businesses.
The European Commission can approve the deal on condition or condition, either unconditionally, in respect of Google’s application, but it can also launch a four-month investigation to fully assess the concerns raised by the parties. The European Commission will decide by July 20 whether to approve the deal.
Analysts say the deal will help Google compete with apple and Samsung in the highly competitive market for fitness trackers and smartwatches. Other competitors in the market include Huawei and Xiaomi.