Google’s $ 2.1 billion acquisition of the market-leading activity tracker company Fitbit, which has dragged on for more than a year due to scrutiny from international regulators, now appears to be complete. At least according to Google. The company announced in a blog post that the deal is complete, but US regulators may not agree. The Justice Department investigation into Fitbit’s use and handling of user health data and the impact on the market is ongoing, the agency reaffirmed after Google announced that the deal was closed.
Questions about health data remain unanswered as Google moves forward
After Google published its blog post on January 14, the antitrust division of the Department of Justice issued a statement clarifying that the deal was still under investigation. According to the Deputy Attorney General of the Department of Justice, Alex Okuliar: “The Antitrust Division investigation into Google’s acquisition of Fitbit is ongoing. Although the division has not reached a final decision on whether to take enforcement action, the division continues to investigate whether Google’s acquisition of Fitbit could harm competition and consumers in the United States. “
Google claimed it had the right to go ahead with the deal because it had reached the end of an agreed waiting period without any action from the Justice Department. While Google may have the legal right to go ahead without approval, that doesn’t mean the deal is clear. The Justice Department could, at the very least, sue to reverse the merger in the future if it finds a violation of antitrust laws (as recently happened with Google’s partnerships with various hardware manufacturers and Internet browser publishers).
Of course, things can always change (and they often do in the big-tech world). Facebook made similar promises after acquiring privacy-focused WhatsApp in 2014, but began to backtrack and integrate the service with its targeted advertising ecosystem in 2016. But for now, Google is assuring users that it will not share health data and will continue to allow connections to third-party services through the Fitbit API at no cost.
That last element is important in terms of the anti-competitive aspect of the Justice Department investigation. One of its main concerns is that Google will shrink the market for wearable fitness devices by refusing to allow other manufacturers to access the Android API or by charging fees, which will prevent integration with smartphones and essentially reduce the market for wearable devices. just him and Apple.
Health data privacy assured for ten years … for now
At a minimum, Fitbit users in the EU will not have to worry about selling or integrating health data into Google’s ad tracking ecosystem; at least not for a decade. That was one of the conditions imposed on the merger when the European Commission approved it in December; Google will also be required to provide developers with access to the API at no cost, be supervised by a trustee who has access to company records, and participate in a fast-track dispute resolution framework.
The merger also remains in legal limbo in Australia, where the Competition and Consumer Commission (ACCC) had previously threatened Google with a $ 400 million fine if it skipped the step. However, the ACCC appears to have reversed that position since the acquisition was formally announced, telling The Verge that it will not fine the companies for merging before formal approval.
Privacy and consumer groups have protested the deal since it was announced. The largest organized pushback comes from a coalition of 20 consumer rights groups, including Privacy International and the Open Society European Policy Institute, which is primarily concerned about Google’s potential market dominance and a possible move into the health care industry. Health. Although fitness tracking devices collect a variety of health data that medical records regulations generally apply to, companies like Fitbit have been able to legally circumvent this level of responsibility in the US, since HIPAA laws existing ones generally apply only to patient care facilities. Google has had some interest in moving to healthcare for several years, primarily applying artificial intelligence (AI) to patient diagnostics and business, as well as creating centralized digital record storage technology. The company criticized its “Project Nightingale” initiative in 2019, which allowed it to access the health data of millions of American patients from the Ascension Health system without informing them.