Categories
Anti-Competitive Anti-Trust Devices Editorial Market Competition Privacy Security

Scrutiny of Google acquisition of Fitbit grows

Fitbit is perhaps the most well-known wearable brand in the world today and has long been a kind of neutral party when it came to platform owners such Apple, Microsoft & Google.

Google announced recently that it is spending $2.1 billion to acquire Fitbit. Now according to New York Post, The DOJ has ramped up its investigation into the acquisition. They are now conducting what they call a second request interview, where more documents and ask for and they take additional time to investigate the deal, according to a source.

20 advocacy groups in the United States, Europe, South America and other countries and regions have signed a joint statement that urges government regulators to pay close attention in the Google acquisition of Fitbit.

“Past experience shows that regulators must be very wary of any promises made by merging parties about restricting the use of the acquisition target’s data,” the groups said. “Regulators must assume that Google will in practice utilize the entirety of Fitbit’s currently independent unique, highly sensitive data set in combination with its own.”

According to Reuters, a Google spokesperson said, “This deal is about devices, not data. We believe the combination of Google’s and Fitbit’s hardware efforts will increase competition in the sector.” To which we say, if the deal is not about data then why pay so much? If the deal is not about data then why not delete it?

Regulators are also worried that the acquisition could give Google immense power in digital markets like the $8.7 Trillion global healthcare market. The deal would likely have far reaching implications in the future of not only healthcare but competition in data and the devices that collect that data.

Assistant Attorney General Makan Delrahim, who is heading up the DOJ’s antitrust division, has recused himself from the case because of his history as a lobbyist working for Google. So now it is Attorney General William Barr who is issuing civil investigative demands or CIDs to parties in the investigation. Barr will be directly involved in the review. Barr told the Wall Street Journal that the investigation of Google’s anti-competitive behavior in suppressing competition would be wrapped up by early summer. Not even life under Corona will deter Barr.

There will likely be a decision on the acquisition after a larger investigation into Google wraps up.

“I think the Fitbit review is serious, approval is not a slam dunk.”

Seth Bloom of Bloom Strategic Counsel

There are serious privacy implications with this acquisition. For one, Fitbit owns a mountain of health data from 28 million users that would be owned by Google and if you were a past or current Fitbit customer that should really give you some anxiety.

Google has a lousy track record with privacy and is currently under 16 separate investigations.

“a high level of risk to the fundamental rights to privacy and to the protection of personal data”.

EU Data Protection Board

The EU Data Protection Board advisory board released a statement expressing concern about the acquisition in February and that it represents a major privacy risk.

“Following the announcement of Google LLC’s intention to acquire Fitbit, the EDPB adopted a statement highlighting that the possible further combination and accumulation of sensitive personal data regarding people in Europe by a major tech company could entail a high level of risk to privacy and data protection,”

Fitbit owns a lot of valuable data on its customers, data like steps, heart rate, sleep & sexual activity, ouch!

This acquisition has far reaching implications, so much so that it most likely should be shut down. At a time when there are calls to break up the Trillion Dollar Goliaths, there is no reason to allow them to get bigger.