Google’s pursuit of Fitbit is a done deal. But what does Google get for its $2.1bn?
Google has struggled to gain a foothold in wearables since the beginning, and, if it wasn't already clear, this move is essentially the company admitting it's lost the battle against Apple.
Wear OS has been a disaster, with only Fossil still shifting watches in significant numbers. Now that you can pick up an Apple Watch Series 3 for $199, it’s only the lack of Android compatibility standing in the way of complete domination.
Minimal market share isn’t a good look, but Google’s also losing the next battle – consumer health.
It's all about health (and data)
Apple’s health ecosystem is going from strength to strength, and it now has a serious medical play in its ECG monitoring. The data it’s learning from users is setting it up to become a healthcare powerhouse.
Over in Mountain View, Google’s smartwatch dreams have lost direction. Wear OS watches are barely capable of locking onto GPS and tracking a run accurately. In terms of being a force in consumer health, forget it, there's more elementary issues to master first.
However, this struggle is where Fitbit comes in. It’s the only wearable company that has offered any kind of competition to Apple in the healthcare niche, and brings with it an incredible brand and user base of 23 million people. Google goes from healthcare also-ran to the steward of some of the most potent health data in the world.
And it can help Fitbit out of its own hole, which is why this deal makes so much sense.
While manufacturing is no problem for Fitbit, it’s not been able bring long-promised advanced health metrics – leveraged by the SpO2 sensor – to consumers. Its sleep apnea, blood oxygen and arrhythmia features are all TBC, and that’s surely hurting uptake of devices.
Leveraging a lot of wearable patents
And there’s more to be leveraged from Fitbit, since plenty of its smartwatch tech and clever power management came from Pebble.
Google, too, has also bought patents from Fossil for hybrid technology.
So, it’s clear that Google is keen on building alternatives to the Apple Watch by snapping up all this tech, but other than a Pixel Watch, what could it realistically yield?
Well, if Google could manufacture cheap smartwatches (perhaps keeping things around the same mark as the Fitbit Versa 2) with advanced sensors and a decent health ecosystem, it could finally deliver some kind of vision of smart health wearables.
But is Google capable of nurturing a successful hardware business? Time and time again, Google has shown its incapable of managing device businesses.
Nest is a comparable acquisition which was left to run in the cold for years – and is only now being brought into the fold. You only need to take a look at the reviews of the Pixel 4, if you want another example.
Google has never been a natural device business. So, whether it’s the right brand to leverage the power of Fitbit remains to be seen, but the pieces are certainly in place to build an Apple Watch challenger.
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