Google jumps into the wearable space with $2.1 billion acquisition of Fitbit
In a joint announcement, Google and Fitbit have revealed that that one of the leading wearable companies will be absorbed into Google’s hardware team, giving the search a strong foothold in the wearable space. The $2.1 billion deal is substantially more than Fitbit’s current $1.6 billion market capitalization, but it seems to be a fair price for a company that’s been leading the wearable space for years.
While Google and Fitbit will need some time to come up with a new product roadmap and strategy, current Fitbit CEO James Park that with “Google’s resources and global platform, Fitbit will be able to accelerate innovation in the wearables category, scale faster and make health even more accessible.” Google’s Rick Osterloh added that the acquisition of Fitbit was an “opportunity to invest even more in Wear OS, as well as introduce Made by Google wearable devices.”
On its own, the acquisition signals that Google is willing to spend a lot of cash to make a move in the wearable space. While we don’t have much to go off of right now, we expect we’ll see better Fitbit integration into the Google Fit app and other Google services.
Google is promising that the data collected by Fitbit will not be used to serve ads and the hardware and software will continue to be “platform-agnostic,” so that it can be used by both Android and iOS users.
It will be interesting to see how the final deal plays out and what Google’s strategy for its Fitbit acquisition will be. The deal is expected to be completed in early 2020 once the FTC and Fitbit shareholders sign off. We’ve been longing for a “Made by Google” smartwatch for quite some time. Hopefully, we won’t have to wait until 2021 for that to happen.
Source: Google