Google Acquires Fitbit for $2.1 billion

Fitbit is now part of Google after the search giant bought the device manufacturer at $2.1 billion. The acquisition will drive Google deeper into the wearables business even as consumers remain wary of what it would mean to have their health data handled by an Ad giant. In the fading spirit of Halloween, what are some of the tricks and treats of this business move?

Can we Entrust Our Health data to Google?

The Treat: Google has a better capacity to handle and integrate healthcare data for better use. Furthermore, the seamlessness in which Google synchronizes information across laptops and phones promises astronomical interoperability. That said, Fitbit customers will have health software work across their laptops, phones, watches, and google glasses in the future.

Additionally, Google is in a better position to address privacy and security concerns surrounding customer data. Jitesh Ubrani from the International Data believes that a bigger company to secure data, given their talent and resources. “When it comes to my data, I would trust a much larger company that has checks and balances in place and the resources to secure my data,” Ubrani says, “because they also have the best talent that’s out there.”

The Trick: After the acquisition, power and control over data will lie in the hands of a few giants, namely Apple, Google, Huawei, and Samsung. The internal operations and uses of this data remain a smokescreen. Second, Google uses keywords, search history, age, and location, among other demographic factors, to determine which ads you see. That begs the question, will Google sell ads against your health data?

Well, the company swore not to. Google says it will “never sell personal information to anyone” and that “Fitbit health and wellness data will not be used for Google ads.” Besides, the two companies have gone an extra step to afford users “the choice to review, move, or delete their data.”

Will The Fitbit Acquisition be Successful?

The Treat: Google will be able to invest sophisticated hardware, software, and AI technology to spur innovations into Fitbit devices. Google resources can help build better products, which will help benefit people, as well as improve competitiveness against Apple watch. Additionally, investing in Fitbit will help Google go deeper into the healthcare market.

Google’s control of both software through Wear OS and hardware through the Fitbits promises smarter android powered watches. Plus, there’s a promise of success if the company integrates predictive AI, which it currently uses in search, for health and wellbeing in Fitbits.

The Trick: Let’s just say that Google has had a few burns with hardware acquisitions and integrating cultures. Casepoint, Google acquired Motorola for $ 12.5 billion, squandered the opportunity, and sold it to Lenovo at $2.9 billion.

Previously, Google failed to integrate Nest due to differences in managerial cultures, which saw Nest leave and then rejoin Google in 2016.

While the circumstances surrounding the Fitbit business differ from those of Nest, Google will have to face a three-fold challenge before it successfully sells Fitbit wearables. The tech giant will have to simultaneously conduct operations while blending differing company cultures, splitting technologies, and merging different software and hardware systems. This feat is complicated as Fitbit is highly vertically integrated.

Bottom Line

Nevertheless, the acquisition promises a lot of success if Google will guarantee data privacy, integration of cultures and systems, and outcompete other giants like Samsung and Apple.