European Commission launches in-depth investigation into Google’s acquisition of Fitbit
- Tuesday, August 4th, 2020
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The European Commission has opened an in-depth investigation into Google’s proposed acquisition of Fitbit. In a statement, the regulator said: “The Commission is concerned that the proposed transaction would further entrench Googles market position in the online advertising markets by increasing the already vast amount of data that Google could use for personalisation of the ads it serves and displays.
Executive Vice-President Margrethe Vestager, responsible for competition policy, added: “The use of wearable devices by European consumers is expected to grow significantly in the coming years. This will go hand in hand with an exponential growth of data generated through these devices. This data provides key insights about the life and the health situation of the users of these devices. Our investigation aims to ensure that control by Google over data collected through wearable devices as a result of the transaction does not distort competition.”
The Commissions concerns centre on the impact of the transaction on the supply of online search and display advertising services, and ad tech services. Specifically, analytics and digital tools used to facilitate the programmatic sale and purchase of digital advertising.
The regulator’s statement notes that through the acquisition, Google would acquire the database maintained by Fitbit about its users health and fitness; and the technology to develop a database similar to Fitbits one. In fact, just last month, Google offered to not use Fitbit’s health data in a bid to quell the Commission’s concerns. It said it would create a data silo, where certain data collected through wearable devices would be kept separate from any other dataset within Google. The data in the silo would be unavailable for Google to use for advertising purposes.
In its statement, however, the Commission said it considers that the data silo commitment proposed by Google is: “insufficient to clearly dismiss the serious doubts identified at this stage as to the effects of the transaction…because the data silo remedy did not cover all the data that Google would access as a result of the transaction and would be valuable for advertising purposes.”
Google agreed to buy Fitbit last November, in a deal worth $2.1bn. The Commission said it will complete its investigation by 9 December.