Google has announced that it has completed its acquisition of Fitbit. Google’s use of the vast amount of user health data has long been the key sticking point of regulatory concern of the deal. The acquisition comes at time when the US Justice Department said it is still conducting an antitrust investigation of the deal. This is also a step for Google to compete with Apple in the fitness and wearable categories.
The levels and intimacy of data collected by these sorts of consumer devices has increased significantly over the past decade. Adding fuel to that fire is the push from companies like Fitbit and Apple to have their products taken more seriously as medical devices — or at least medically adjacent. Both companies have commissioned health studies, sought FDA clearance and worked with insurance companies.
Google has often come under fire as targeted advertising continues to be at the heart of much of what the tech giant does. Google and Fitbit have been quick to insist that the deal is all about hardware. Shortly after the deal being official was announced, the US Justice Department’s antitrust division released a statement saying it hasn’t signed off on the deal.
Alex Okuliar, a deputy assistant attorney general said, “The Antitrust Division’s investigation of Google’s acquisition of Fitbit remains ongoing. Although the division has not reached a final decision about whether to pursue an enforcement action, the division continues to investigate whether Google’s acquisition of Fitbit may harm competition and consumers in the United States.”
The Justice Department investigation raises the possibility that the government could sue to unwind the deal later if it determines that the merger violates antitrust laws. The department and a group of state attorneys general sued Google last year, accusing the company of abusing its dominance in online search in violation of antitrust laws.
Google said in a statement that it closed the deal because the investigation period had ended and the Justice Department hadn’t taken action to stop it. In the US, companies are free to complete deals after they comply with the government’s request for information, a period that can last for a year or longer. If enforcers want to stop a merger, they have to sue and win a court order blocking it. They can also seek to unwind consummated deals.
The $2.1 billion deal comes with a number of concessions. The EU in particular presented a number of caveats when it finally greenlit the acquisition last month. It noted, “The commitments will determine how Google can use the data collected for ad purposes, how interoperability between competing wearables and Android will be safeguarded and how users can continue to share health and fitness data, if they choose to.”