Google has agreed to buy Fitbit for $2.1 billion in a move giving the United States tech giant an entry into the wearable technology space, the two companies announced Friday.
Google is paying US$7.35 per share in cash for the San Francisco-based fitness tracker technology company.
Fitbit's team will now join Google and most likely expand on Wear OS with Pebble's software team (which Fitbit acquired last year) while also pivoting its Versa smartwatch into a "Made by Google" product.
Googlerecently spent $40 million to buy Fossil's smartwatch tech, and the Fitbit acquisition is the company's latest investment in the wearables business. In the release, Fitbit said it never sells personal information and that the Fitbit health and wellness data won't be used for Google ads. But it won't have to worry about that when it becomes a Google company.
"The deep health and fitness data, coupled with the 28 million active users on the Fitbit platform, offer a tremendous value", Craig Hallum analysts wrote in a note cited by Reuters.
So, we'll see what happens from here, but it's clear that big things are in store for Wear OS once this acquisition is complete. Some users also use Fitbit devices and its app to track food and water intake. No telling how soon, of course, this announcement just covers the signing of an agreement to acquire Fitbit its too early to talk about hardware.
Google will pay $7.35 a share for the fitness tracker, helping it advance its ambitions for wearable technology. In addition, Fitbit pledged to continue to remain "platform agnostic" with support for both Google's Android and Apple's iOS.
In the U.S., where the laws are weaker and consumer protection regulator, the FTC, takes a far more lenient approach to large corporations, consumers should assume that regardless of what Google says in a blog post, a big incentive for its acquisition of Fitbit is to receive huge amounts of additional personal data to feed into its systems.
More importantly, having a Google device on the wrist could drive its wearers to use Google services even more - giving Google more ways to collect data and sell ads.
Fitbit makes a range of devices, from basic trackers that mostly count steps to smartwatchesthat can display messages and notifications from phones.
Fitbit, of course, would not be the first foray by Google or its parent, Alphabet, into either healthcare or wearables.
"Google sees important opportunities in digital health moving forward, but they needed a stronger set of devices to fit into the digital health environment", said Bob O´Donnell, chief analyst at Technalysis Research. However, due to the competition from bigger companies like Apple, Samsung, and Xiaomi, its shares suffered.