Google All-In With Wearables: Spends $2.1B to Buy Fitbit
With the wearable fitness tracker market heating up, Google parent Alphabet stepped up its game announcing the $2.1 billion acquisition of Fitbit.
Speculation has been surging all week that Alphabet would make an offer for the maker of fitness trackers, which sent its stock soaring.
Google to roll out wearable devices
Google is paying $7.35 a share in cash for Fitbit. In a blog post Rick Osterloh, senior vice president of devices and services at Google said the acquisition enhances its ability to produce wearable devices that sit in the background assisting people whenever they need it.
"Over the years, Google has made progress with partners in this space with Wear OS and Google Fit, but we see an opportunity to invest even more in Wear OS as well as introduce Made by Google wearable devices into the market," wrote Osterloh. "By working closely with Fitbit’s team of experts, and bringing together the best AI, software, and hardware, we can help spur innovation in wearables and build products to benefit even more people around the world."
Data protection a big focus
The Google executive went on to say the company is focusing a lot on protecting users' data and privacy when developing these new wearable devices. The Internet search giant vowed to be transparent about the data it collects and why it's collecting. "We will never sell personal information to anyone. Fitbit health and wellness data will not be used for Google ads. And we will give Fitbit users the choice to review, move, or delete their data," he wrote. This isn't Google's first acquisition in the smartwatch market in recent months. At the start of 2019, it spent $40 million to purchase smartwatch tech from Fossil.
Apple in Google's sights
With the acquisition of FitBit Google is taking on Apple in the smartwatch market. Just this week Apple CEO Tim Cook said wearables will be the growth driver in the years to come for the technology giant. "There will be a day in the future that we look back and Apple's greatest contribution will be to people's health," he said, according to a transcript of its fourth-quarter earnings call. Apple's booming smartwatch business has been at the expense of FitBit, which has struggled to find its place in the market. As of August Apple's smartwatch market share stood at 46.4%. FitBit's is at 9.8%.