Google’s Fitbit acquisition is cleared by EU with some conditions applied
Google and Fitbit are one step closer to final completion of their merger after the European Commission gave final approval following a four-month probe. Google bought the wearables pioneer back in November 2019 for a not-unsubstantial $2.1bn but has been awaiting clearance from global regulators including in the European Union, with questions raised over whether the move would stifle competition, leading the Commission to launch a full investigation. However, following Google’s agreement to abide by a number of pledges, their concerns have been addressed and the merger approved.
In order to get past the regulator, Google has agreed not to use health, fitness, or location data from Fitbit devices for advertising purposes, inside the European Economic Area. This will be safeguarded by insisting that Google keep Fitbit data ‘siloed’ from other data. Users will have to explicitly consent to let Google apps ‘see’ the data collected by Fitbit. It has also pledged to maintain API access to the Fitbit platform for third parties, and simultaneously ensure there are no functionality limitations in the API for third-party smartwatches and fitness trackers when paired with an Android phone.
Announcing the decision, Executive Vice-President of the European Commission, Margrethe Vestager, said: “We can approve the proposed acquisition of Fitbit by Google because the commitments will ensure that the market for wearables and the nascent digital health space will remain open and competitive.”
Under the terms of the approval, Google will have to abide by the ruling for ten years, after which time it will be reviewed, with the Commission noting that it may well extend the rules regarding Fitbit data use in Google advertising for a further period. A trustee will be appointed to monitor if Google is sticking to its agreements, and will require Google to give that person or body access to relevant records, and if required, to personnel, facilities, and technical data. The ruling will make it nigh-on impossible for Google to simply absorb Fitbit once the deal closes, assuring it will remain a separate brand in its own right. The entire deal was supposed to close by the end of 2020, but the US Department of Justice has yet to make its own ruling on the acquisition.