Google has promised not to harvest and use Fitbit data for its advertising business, as it goes on a charm offensive to get its acquisition over the line.
The company announced back in November 2019 it was to buy Fitbit in a $2.1bn deal, but the acquisition has since been in limbo with increasingly close government scrutiny.
Firstly, US regulators turned the case over to the Justice Department, and the EU have also taken a close interest.
The issue is that critics are concerned about Google’s use of personal medical data. While most think of its search business, advertising powers Google’s huge revenues, and the prospect of it using the personal health data of millions of users has led for calls for the deal to be vanquished.
For its part, Google has promised the deal is about “deal is about devices, not data” and that it would “work with the European Commission on an approach that safeguards consumers’ expectations that Fitbit device data won’t be used for advertising.”
Google has been struggling to make an impact in the consumer health and wearables market – and its Wear OS (formally known as Android Wear) platform hasn’t improved fast enough to keep pace with the likes of Apple, Garmin and Fitbit.
It’s relied on partners, and while there has been success with Fossil and Tag Heuer, it has been predominately lifestyle brands that have gravitated to the platform. And Wear OS simply doesn’t have the capability nor device support to rival the Apple Watch and others as a consumer health device.
And it’s now losing ground to Huawei, which has surged to second place in the smartwatch market thanks to a searing performance in China.
So there’s a lot hanging on this Google deal.
Firstly, Fitbit needs Google’s support, cash and software expertise to transition from fitness and wellness to a true health player.
And now we know that Google needs Fitbit’s prowess to grow its hardware division.
Hardware has never been an ideal fit at Google, which has never released its own wearable despite constant rumors of a Pixel Watch.
And as time progresses, it feels like that wearable technology needs this deal to happen.
Because if it’s rejected, we fear that the cost will be innovation stalling at two companies so central to its formation.
While the likes of Huawei, Xiaomi and Huami have driven down prices and eaten market share, they’re essentially copycat devices. The expertise of those companies is bringing top-end features to the masses.
But innovation has been driven by Apple, Google and Fitbit. And we need these guys driving the next generation of wearable technology.