Google to acquire wearable firm Fitbit for $2.1bn

Fitbit close-up

Dave Kotinsky Getty Images for Fitbit

Google is buying Fitbit for $2.1 billion, hopping into the fitness and wearables scrum with competitors like Apple. "If you look at what Apple has done with wearables, it's a missing piece of the puzzle for Google".

Both Google and Fitbit have had privacy lapses.

On the other side, Fitbit issued a press release to its investors that "Fitbit health and wellness data will not be used for Google ads". Fitbit typically asks for date of birth, gender, height and weight to help with calorie and other calculations. Women can also track their periods.

Google said on Friday that it sees an opportunity to introduce "Made by Google" wearable devices into the market and invest more in wearable technology. And Google doesn't sell a device of its own.

A more cynical view of Google's acquisition could be that it was more about branding and user acquisition than anything else. Reading between the lines of Google's announcements, it seems Fitbit OS will eventually be merged into Google's platforms.

"There are so many ways to finesse that statement", said privacy expert Joseph Turow, who teaches at the University of Pennsylvania.

James Park, the co-founder and CEO of Fitbit comments on the acquisition, "Google is an ideal partner to advance our mission". How Google will be able to maintain Fitbit OS' far superior battery life or account for Fitbit's non-smartwatch devices is also up in the air.

I am skeptical. Google has had five years with Wear OS.

And then there is Motorola - bought in 2011 by Google and quickly dumped in 2014. Whether it is the anemic operating system, or the more significant problem, Qualcomm's lackluster processors, it has wasted nearly all of it. ASUS, Motorola, Huawei, and Samsung have all paired down Wear OS devices or abandoned them for their own proprietary systems. Josh Hawley, a Missouri Republican, tweeted. The transaction is expected to close sometime next year.

While Fitbit all but created the field, it has been shredded by the competition.

Its market capitalization soared to just under $10 billion after becoming a public company in 2015. The acquisition is Google's second major purchase this year, after it agreed to pay $2.6 billion for cloud software provider Looker in June.

But today, I'm specifically talking about Google and Fitbit. Fitbit stock holders will receive $7.35 in cash for each share they own. The company's shares were trading up 15% at $7.11. The companies indicated in their securities filings they'd likely need to obtain approval from antitrust watchdogs in order to consummate the merger - a process that arrives precisely at a moment when all of Silicon Valley is under the political microscope in Washington for being too big and powerful. The Fitbit team has built a great health and fitness experience that is loved by people all over the world. It offers free Fitbits to participants.

Its official – Google will acquire Fitbit.

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