Consultation begins on proposed Google Fitbit undertaking

The ACCC is seeking views on a proposed court-enforceable undertaking offered in Australia to the ACCC by Google in relation to its proposed acquisition of Fitbit, Inc (Fitbit).

“Our decision to begin consultation should not be interpreted as a signal that the ACCC will ultimately accept the undertaking and approve the transaction,” ACCC Chair Rod Sims said.

“Feedback from interested parties will assist us to decide whether the behavioural remedy proposed is capable of addressing our competition concerns regarding this transaction.”

The proposed undertaking would require Google to:

  • not use certain user data collected through Fitbit and Google wearables for Google’s advertising purposes for 10 years, with an option for the ACCC to extend this obligation by up to a further 10 years;
  • maintain access for third parties, such as health and fitness apps, to certain user data collected through Fitbit and Google wearable devices for 10 years; and
  • maintain levels of interoperability between third party wearables and Android smartphones for 10 years.

The ACCC released a statement of issues on 18 June 2020. The statement of issues highlighted concerns that Google would have the incentive to restrict rival wearables’ access to critical Google services such as Google Maps and the Google Play app store, or restrict their interoperability with Android smartphones.

Concerns were also raised that the proposed acquisition may provide Google with access to unique and substantial health related data that may improve the targeting capabilities of its advertising services.

“The ACCC is seeking feedback from industry and consumers on the long term effectiveness and enforceability of Google’s behavioural undertaking to address the competition concerns raised by its proposed acquisition of Fitbit. The ACCC has not decided whether or not it will ultimately accept any undertaking,” Mr Sims said.

The ACCC invites submissions on the proposed undertaking by 9 December 2020.

More information is available on the ACCC website at Google LLC proposed acquisition of Fitbit Inc.

Background

Google is a US-based information technology company. Google is the largest subsidiary of Alphabet Inc., specialising in internet-related services and products. Its principal activities are the provision of online search services, the sale of online advertising space on its own websites (including Google Search and YouTube), and the supply of advertising technology services to facilitate advertising space on third party websites.

Fitbit is an American company headquartered in San Francisco, California that develops, manufactures and distributes wearable devices, software, and services in the health and wellness sector under the brand name ‘Fitbit’. It is active in Australia via its subsidiary Fitbit (Australia) Pty Ltd.

Fitbit’s products include fitness wearables, smartwatches, smart scales, and software. Fitbit’s wrist-worn wearable devices are supported by the Fitbit mobile app and Fitbit’s proprietary operating systems.

The ACCC’s provisional decision date of 9 December 2020 will be delayed. As the ACCC undertakes its consultation process, a new decision date will be announced in due course. Google offered its proposed undertaking to the ACCC in November 2020.

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