The acquisition is expected to close in May 2020, according to MKM Partners.

Dan Jones, Mobile Editor

November 1, 2019

2 Min Read
Google Buys Fitbit for $2.1B to Increase Wearables Presence

Google has set heart rates racing with its $2.1 billion planned buyout of wearables maker Fitbit on Friday.

MKM Partners said in an analyst note this afternoon that Fitbit has sold 100 million devices and has over 28 million active users. The analysts suggest this buyout will signal the intensification of competition between Google and Apple in the fitness space.

Apple is number one in wearables with a 26% market share, according to IDC. Fitbit has a declining 6% market share, IDC says.

"We believe this is a smart tuck-in acquisition for Google, given its somewhat spotty track record with Wear OS while Apple has done a pretty good job with its Watch ecosystem strategy," writes MKM Partners' Executive Director Rohit Kulkarni in the note.

Fitbit says that its latest generation of Charge 3 devices can sync with 200-plus Android and iOS cellular devices. The fitness tracker can also receive text messages via Androids or iPhones.

Google has only said that the acquisition will close in 2020, leaving itself a fairly large window for the deal. MKM predicts that the acquisition will be wrapped up in May 2020. "We believe this acquisition could face protracted regulatory reviews, particularly by the European Commission, given the potential concerns over data use," says MKM. "The merger agreement allows for extensions through May 2021 and provides for a ~12% reverse termination fee for failure to obtain antitrust approvals."

Fitbit highlights -- in the acquisition announcement -- that the company never sells information, and Fitbit health and wellness data will not be used for Google ads.

Related posts:

— Dan Jones, Mobile Editor, Light Reading

About the Author(s)

Dan Jones

Mobile Editor

Dan is to hats what Will.I.Am is to ridiculous eyewear. Fedora, trilby, tam-o-shanter -- all have graced the Jones pate during his career as the go-to purveyor of mobile essentials.

But hey, Dan is so much more than 4G maps and state-of-the-art headgear. Before joining the Light Reading team in 2002 he was an award-winning cult hit on Broadway (with four 'Toni' awards, two 'Emma' gongs and a 'Brian' to his name) with his one-man show, "Dan Sings the Show Tunes."

His perfectly crafted blogs, falling under the "Jonestown" banner, have been compared to the works of Chekhov. But only by Dan.

He lives in Brooklyn with cats.

Subscribe and receive the latest news from the industry.
Join 62,000+ members. Yes it's completely free.

You May Also Like