The European Commission has confirmed an in-depth investigation has started into Google's proposed takeover of wearables maker Fitbit. The EU's competition watchdog said it was concerned the deal would give Google access to additional data strengthening its position on the online advertising market. If it finds the deal could distort competition, it may ask Google for concessions or block the takeover.
Google announced the takeover last November, and the deal has already raised competition concerns in other markets such as the US and Australia. The European Commission said its initial investigation found that access to the data held by Fitbit on its users and their health could give Google a key advantage in the advertising market, helping it to personalise ads even more to individuals.
The risk is this could strengthen Google's position in the search and display advertising markets as well as in ad technology, making it difficult for rivals to match its services or new players to enter the market. The Commission found that Google is already dominant in the search market and has a strong position in display advertising and ad technology in most of the EU countries.
In addition to the impact on the online ads market, the Commission plans to look at the potential effects of the deal on the emerging market for digital healthcare and whether Google could limit interoperability of other wearables with Android once it controls the Fitbit devices.
The Commission confirmed that Google already offered to create a 'silo' of certain Fitbit data, keeping it separate from its advertising activities. However, the Commission found that the company's commitment would not cover enough of the data that could be relevant to Google's advertising business.
The investigation has a preliminary deadline of 09 December.
In a response to the EU statement, Google repeated its claim that the takeover is about "devices, not data", noting the many competitors in the wearables market. In addition to its offer of the data silo, it would give Fitbit users the choice to move or delete their data, and Google said it was committed to maintaining interoperability as well. "We appreciate the opportunity to work with the European Commission on an approach that addresses consumers' expectations of their wearable devices," the company said in a statement.
