Fitbit bid questioned
Regulators are concerned about the amount of data Google would have access to if its buys Fitbit.
The ACCC has outlined some concerns with Google’s proposed acquisition of Fitbit, stating that Google’s access to consumer health data may further entrench its dominant position.
Fitbit, a company that makes wearable devices, has collected health information from consumers for more than 10 years, including users’ daily step counts, heart rate and sleep data.
Late last year, Fitbit announced that it had entered into an agreement to be acquired by Google for US$2.1 billion.
“Our concerns are that Google buying Fitbit will allow Google to build an even more comprehensive set of user data, further cementing its position and raising barriers to entry to potential rivals,” ACCC Chair Rod Sims said.
“Google’s substantial market power is built on its concentration of search and location data, and data collected via third-party websites and apps.
“The access to user data available to Google has made it so valuable to advertisers that it faces only limited competition.”
The ACCC has launched an investigation into certain online advertising services and nascent data-dependent health markets, exploring the uniqueness and potential value that Fitbit’s data poses for Google, and its likely competitors in these advertising and health markets.
The consumer watchdog is also concerned that Google will favour its own wearables devices over competitors’ when supplying important related services such as WearOS, Google Maps, Google Play Store or Android smartphone interoperability.
“This is a rapidly evolving sector and, while there is inherent uncertainty about how digital markets will develop, it does not mean as a competition regulator we can conclude there will be no lessening of competition simply because the future is unclear,” Mr Sims said.
“Our position is where there is uncertainty, especially surrounding such important markets, the ACCC must thoroughly investigate the potential for an acquisition to stymie future competition. As a competition regulator it is our job to weigh carefully the potential issues concerning data and advertising that may follow transactions such as these.
“We will work very closely with other competition authorities in other jurisdictions that are also reviewing this transaction.”