Fitbit Health Data Won't Be Used for Google Ads in $2.1B Google Buy
Fitbit agreed to be bought by Google in a cash deal valued at $2.1 billion, as expected (see 1910290049). Fitbit will remain platform-agnostic and “strong privacy and security guidelines” won’t change, it said Friday. “The company never sells personal information, and Fitbit health and wellness data will not be used for Google ads.” Fitbit always had strong privacy and security guidelines “and this will not change,” it said: Users will continue to be in control of their data.
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Privacy and security “are paramount, blogged Rick Osterloh, Google senior vice president-devices and services. The company will work hard to protect users’ data, “put you in control and give you transparency about your data,” he said, saying it will be transparent about data it collects and why: “We will give Fitbit users the choice to review, move, or delete their data.” The deal's expected to close next year subject to Fitbit shareholder and regulatory approvals. The companies didn't say what will happen to the acquiree's executives, beyond Fitbit becoming a wholly owned subsidiary of Google, which itself is owned by Alphabet.
Tech platforms are under increased antitrust scrutiny. But Fitbit’s relatively small size and hardware-based nature “make the deal less likely to face regulatory opposition,” Cowen analyst John Blackledge wrote investors. Wedbush's Michael Pachter wrote investors that Google “appears intent to expand in MedTech and go head-to-head with Apple, so it buying Fitbit makes more sense than trying to build yet another competitor.” He expects regulators “to scrutinize Google’s handling of Fitbit’s vast personal data." That's despite Fitbit saying Google won't sell personal information, health data won't be used for targeted advertisements and users will have full control of their data, he added.
Google would pay a $250 million fee if it can’t obtain antitrust approvals. House Antitrust Subcommittee Chairman David Cicilline, D-R.I., called for “an immediate and thorough investigation” Friday. Google is signaling that it “will continue to flex and expand its power” despite “immense” antitrust scrutiny from Congress, DOJ and state attorneys general, he said.
Also last week, Fitbit sought tariff exemptions, along with Apple and others (see 1911010025).