There might be a sticky wicket in Google/Alphabet’s proposed acquisition of Fitbit for $2.1 billion.
On the other hand, the move seems to make sense to some market analysts in terms of offering a sort of symmetry – where Apple Watches can sync with the iPhone, a Google Fitbit platform would assumedly provide the same kind of compatibility with Android, Apple’s biggest rival OS in the smartphone market.
Today, there’s news that regulators in the European Union are warming to the idea of Google taking over the wearable brand that has been lagging in market share, losing out to Apple Watches for several years.
In 2015, prior to the sustained Apple Watch movement, Fitbit’s market share was just over a quarter of the market, at 26%.
Since then, it’s slid to about one third of that, with Apple Watch grabbing a lot of the remaining customers.
“After proving that the concept was viable, Fitbit’s turf was encroached on by Apple’s premium offering,” wrote Nicholas Rossolillo at Motley Fool late last year, describing the change broadly. “At the bottom end of the market, cheap alternatives led by Chinese tech firms also made their move. Overall, Fitbit has been unable to turn back the tide in its favor. According to data compiled by tech researcher IDC, it’s been all downhill for the last four years.”
It’s yet to be seen how much of a smooth glide Google will have in getting the acquisition greenlighted, but according to Reuters, the tech giant has promised to offer the android API to competitors to help make sure that it’s more compliant with antitrust principles that have led to being these tech companies being under scrutiny to begin with.
The EU agency has a deadline of December 23 for making the final decision on the antitrust issue. That’s not the only hurdle for the merger, but it’s a significant one. Pay attention to centralizing of big tech services, because it moves markets.
