Google Buy Fitbit for $2.1 Billion [ BIG- entry into the wearable technology space]

Google has just announced that it is buying the Fitbit

Google has just announced that it is buying the Fitbit accessory company for $ 2.1 billion. In a blog post announcing the news, Google’s senior vice president of devices and services, Rick Osterloh, said the purchase of Fitbit is “an opportunity to invest even more in Wear OS, as well as to introduce portable devices Made by Google in the market”. Google Buy Fitbit

Google’s parent company, Alphabet, is buying Fitbit. The acquisition confronts Alphabet against the tech giant Apple in the portable fitness tracking space. Fitbit says Google is paying $ 7.35 per share in cash for the company, valuing it at around $ 2.1 billion.

The news comes a few days after a report from Reuters, which claimed that Google was in talks to buy the popular company of fitness trackers. Google Buy Fitbit

“FITBIT HEALTH AND WELFARE DATA WILL NOT BE USED FOR GOOGLE ADS.”

Under the agreement, Fitbit will join Google. (It is similar to the current situation with Nest, which is now fully under Google, compared to when Alphabet originally acquired the smart home company, but left it as a separate division under the corporate structure.)

According to a separate press release issued by Fitbit, the company will still take the privacy of health and fitness data seriously, noting that “Fitbit health and wellness data will not be used for Google ads.”

The acquisition makes a lot of sense: Google has spent years trying (and failing largely) to enter the portable device market with its Wear OS platform, but it has trouble having a real impact. Google Buy Fitbit

Fitbit hardware options have always been excellent, which gives Google a much stronger foundation to build on future portable devices integrated with Android. And the company’s strong focus on fitness tracking could also naturally be integrated into Google’s existing Google Fit applications, offering Google a solid alternative to integrating Apple Watch’s physical fitness tracking with the iPhone.

On the other hand, Google’s software skills and extensive developer support could help Fitbit smartwatches like the Versa be a little smarter, along with deeper software integration with Android than a closer relationship could offer.

The purchase of Fitbit is not the only recent investment that Google made on portable devices focused on fitness, either: in January, the company spent $ 40 million to buy Fossil’s unknown smartwatch technology based on the technology that Fossil acquired when it bought the manufacturer of portable devices Misfit. in 2015

How Google could help Fitbit ?

We can see that Fitbit is having a hard time fighting the growing competition. With the support of Google, the company could invest heavily in research and development, as well as sales and marketing.

Fitbit has tried to launch several products in recent quarters with different price points, but this has not translated into revenue growth. Google has a cash balance of $ 121 billion and can generate billions to face Apple Watch, Xiaomi and Huawei.

Earlier this year, Google acquired the innovative smart watch technology from Fossil for $ 40 million. Does this mean that Fitbit- has been on Google radar for quite  some** time?

Google may also consider expanding the Fitbit Health Solutions segment in the coming years. On October 17, Fitbit announced a health care partnership with the Bristol-Myers Squibb-Pfizer Alliance. This association is intended to help early detection of people at increased risk of stroke.

In the first six months of 2019,

  • Fitbit Health Solutions sales increased 42%, and revenues from this segment could reach $ 100 million in 2019.
  • Although it represents less than 10% of total sales, Google could expand significantly in This market through partnerships.

Would it make sense that- for Google- to acquire Fitbit-?

Google would be the best, since it would integrate Android Wear x.x into trackers and could also take full advantage of data tracking to help consumers, health insurance companies get discounts, etc.

There would be synergy since Google could develop Android Wear (OS) on Fitbit devices as they seek faster penetration into the Digital Health space. In the same way that many smartphones already use Android (OS) but Google has its own hardware now with Pixel, they could use Fitbit as their “own” brand in the emerging IoT market that will be the fastest growing hardware segment in the next years. Google Buy Fitbit

Why is Google getting into diabetes?

“Given the technical challenges and regulatory requirements, experts say it could be years before any new device reaches patients.”

By buying Fitbit, that would speed up the process, so it wouldn’t take years!

  • Google is working on a portable device that can evaluate the blood sugar levels of diabetics
  • A coincidence made in heaven in my opinion, since machine learning will trigger from the experience in Google algorithms on Fitbit devices. In my humble opinion, no smart watch will outperform Fitbit.
  • How machine learning will take portable data to the next level
  • The competition generally fails in battery life, then the operating system features, then the interaction with the community that Fitbit wins in all those areas, so if you can find Android Wear / custom watch faces / digital assistants Voice on Fitbit devices, Alphabet will catapult portable data to the next level.

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