This story was originally published and last updated .
Google's acquisition of Fitbit is now complete, according to an announcement made by the company earlier this morning. Claiming that the deal was always about Fitbit's hardware expertise and not customer data, Google says it has smoothed over regulatory concerns with a series of safeguards and commitments. However, we aren't sure if either US or Australian regulators' concerns have actually been addressed given the ongoing state of both investigations.
Google secured the European Commission's blessing back in December for the long-awaited $2.1 billion deal. However, there were a few conditions attached to it, all of which seem to have been addressed based on Google's announcement. In short, Google has to keep Fitbit user data separated, where it can't be used for things like advertising, and third-party access to existing Fitbit web APIs must be maintained. Google also can't give Fitbit an unfair advantage in the Android wearable marketplace or give other companies an indirect disadvantage by creating new closed APIs, etc.
On paper, this would appear to close out the merger, which we've been waiting to happen since it was announced back in November 2019, but there are two potential hiccups.
One, the Australian Competition and Consumer Commission raised its own objections to the deal just a few weeks ago, claiming its investigation wouldn't be complete until March 25th. You don't need to be a horologist to read today's calendar and see that today (i.e., January 14th) is quite a bit before then. When asked for details regarding Google's announcement that the merger was "complete," the ACCC provided us with an extra-chunky statement, claiming that things have been escalated due to Google's action into an "enforcement investigation," which could be subject to legal action. Choice excerpts from the super-long statement are included below:
The ACCC will continue to investigate the acquisition of Fitbit, Inc (Fitbit) by Google LLC (Google), which has now been completed despite the ACCC’s ongoing public review of the transaction.
“Google’s decision to complete its acquisition of Fitbit before we completed our merger review means we are now conducting an enforcement investigation. As a result, and depending on the results of our investigation, we will consider whether to take legal action on this matter,” ACCC Chair Rod Sims said.
In December, the ACCC decided that it would not accept a long-term behavioural undertaking offered by Google that sought to address competition concerns because of the significant difficulties in effectively monitoring and enforcing compliance with the undertaking.
As this is now a completed acquisition, the ACCC will remove this matter from its Public Informal merger register. The investigation will accordingly no longer have a forecast decision date."
When asked, a Google spokesperson provided us with the following statement in response to the ACCC:
"We have voluntarily engaged with the ACCC since the transaction was announced in November 2019 and we remain willing to continue engagement during their ongoing investigation. We’re confident this deal is pro-competitive and will result in greater choices and benefits for consumers, both globally and in Australia."
Second, it looks like Google also didn't get the US Department of Justice's approval for the merger, either. Deputy Assistant Attorney General Alex Okuliar tells us:
"The Antitrust Division’s investigation of Google’s acquisition of Fitbit remains ongoing. Although the Division has not reached a final decision about whether to pursue an enforcement action, the Division continues to investigate whether Google’s acquisition of Fitbit may harm competition and consumers in the United States. The Division remains committed to conducting this review as thoroughly, efficiently, and expeditiously as possible.”
However, a Google representative claims that isn't the case, and that it did get implicit approval following a waiting period expiration:
“We complied with the DOJ’s extensive review for the past 14 months, and the agreed upon waiting period expired without their objection. We continue to be in touch with them and we’re committed to answering any additional questions. We are confident this deal will increase competition in the highly crowded wearables market, and we’ve made commitments that we plan to implement globally."
Google's acquisition of Fitbit has been a subject of review since 2019, and so far, the DoJ has yet to publicly state the results of the investigation. That could be due to the general scope of its investigations against Google, or perhaps Trump's DoJ simply failed to renew or extend that waiting period, implicitly granting approval of the merger by failing to stay on top of the deadline previously imposed. (We aren't familiar with the process here, and the DoJ doesn't seem to have divulged those details that we can find.) We've reached out to the US Department of Justice for more information, and we've pointed out the discrepancy to Google as well; we'll update if we hear more. We've also reached out to the Australian ACCC for more information as well.
Recently, Fitbit wearables have been picking up some Googly features, like Assistant integration, and Google's been building deeper integration for wearables as well, like with the Assistant's new Wellness section. Even before the merger was "complete," both Google and Fitbit have been building toward it, and the company's recent wearables have reviewed well. If that trend continues, this could mean better wearables for consumers, just as the global market is set to explode.
Between Australia and the US, though, it looks like Google has jumped the gun on announcing an end to the merger. Maybe the company is trying to railroad regulatory agencies into premature approval, though that's probably not a wise move in the middle of so many antitrust investigations.
Google may not have secured US Department of Justice approval either, as all signs point to the regulatory agency's investigation as ongoing. Our coverage has been updated with both the statement the DoJ has provided some outlets and a statement from Google regarding the expiration of the DoJ's own waiting period.
The ACCC also tells us that its investigation is ongoing, and that this decision to complete the merger before the review is done has escalated it into an "enforcement investigation," with the potential of legal action. Google has also responded with its own statement, all included in our updated coverage above.