Google is buying Fitbit for $2.1bn, in a move reminiscent of how the company acquired Motorola Mobility – and then a good chunk of HTC – in order to create the flagship devices that were needed to showcase Android at its best. However, unlike HTC, Fitbit doesn’t use the Android operating system, which presents something of a conundrum.
While Google still owned Motorola (it later sold it on to Lenovo), the Moto 360 smartwatch was meant to be the direct rival to Apple’s Watch. But the market fragmented, as other Android Wear advocates emerged, and Samsung pressed ahead with its own Tizen platform. Then, the bottom fell out of the market anyway, massively driving down the prices for Android and Tizen gadgets, while Apple Watch went from strength to strength.
Fitbit was always largely unperturbed by Android Wear. It had settled on its own operating system and software, and chose to interact with Android via the Fitbit app, rather than through native integrations. To this end, it was never having to choose between being a trendsetter or play catch-up, and could choose to focus on competing with its main rival Garmin in the fitness tracking segment.
That segment has suffered its own challenges because of competition from cheap, no-name Chinese brands. Overall, it has been a difficult few years for the wearables market. There are still very few killer apps, and the most pressing are fitness focused.
The Apple Watch has not achieved the numbers some predicted for it, but it has many nice-to-have features, which add up to a much-liked user experience – facilitating payments, controlling notifications from the iPhone, fitness tracking, and direct control over certain phone functions, like media playback. Apple couldn’t charge $300 for one of these features in isolation, but their value adds up to that price tag.
In this regard, Android has lagged, and this is largely due to the fractured developer ecosystem. Apple retains complete control over how the Watch interacts with the iPhone, and its developer programs and App Store ensure that features are added in a safe cadence – and nothing risks damaging the user experience. In the Android ecosystem, there is no such collective front, and each brand is essentially left to its own devices – reskinning Android, perhaps contemplating a smartwatch, working out how aggressively non-Google their apps could be.
All of this would have greatly frustrated Google which has had some limited success in creating a ‘pure’ Android user experience and showcasing it on the Pixel handsets.
The user interface, across the industry, is more uniform than it used to be, and closer to the open source elements that form the basis of Android even for those which have not signed up to the Open Handset Alliance, which compels them to include the Google Play suite (though most have stuck with OHA/Google, Huawei has been forced to seek alternatives).
On the surface, it seems Google is trying to do something similar with Fitbit – buying the leader in the non-Apple smartwatch segment, and trying to bring the rest of the industry round to how a wearable would augment the Android experience. But, Fitbit does not use Android Wear OS.
This means that Google can either focus on how Android should interface with non-Android wearables, and standardize around that process; or try to overhaul the Fitbit portfolio completely to create new Android-powered devices that then natively integrate with Android-powered smartphones.
The former seems less difficult, and less intrusive to Fitbit. At $2.1bn purchase price, it would likely be more affordable to in develop a Pixel Watch inhouse, if the latter were actually the plan, especially as Google has such sway over the Wear OS design and experience. This might also be a sign that Wear OS is now properly on the back burner, although Google would never admit to this. If the focus proves to be on how to interface with non-Android wearables, that would be a clear sign that Google thinks Wear OS is beyond saving.
The ulterior motive could be all the health data that Fitbit has collected, and all the happy customers that might prove to be willing participants in an expansion into the healthcare industry. Google has a clear interest here, with its Verily division the best evidence, but more importantly, chief rival Apple has made inroads into the health sector, and Google wants to ensure that Android does not miss out.
In this regard, flagship devices are pivotal, as the healthcare sector is extremely risk-averse, and no-name Chinese devices are going to raise hackles. With 100m devices sold, Fitbit has great sway in this data gathering initiative, but whether it could convince users to sign up to a Google scheme depends on how savvy Google’s marketing is.
Apple continues to stress the privacy angle in its promotions, and Google has to be quite careful here. In the announcement, Fitbit was quite pointed in this regard, saying: “Consumer trust is paramount to Fitbit. Strong privacy and security guidelines have been part of Fitbit’s DNA since day one, and this will not change. Fitbit will continue to put users in control of their data and will remain transparent about the data it collects and why. The company never sells personal information, and Fitbit health and wellness data will not be used for Google ads.”
“More than 12 years ago, we set an audacious company vision – to make everyone in the world healthier. Today, I’m incredibly proud of what we’ve achieved towards reaching that goal. We have built a trusted brand that supports more than 28m active users around the globe who rely on our products to live a healthier, more active life,” said James Park, co-founder and CEO of Fitbit. “Google is an ideal partner to advance our mission. With Google’s resources and global platform, Fitbit will be able to accelerate innovation in the wearables category, scale faster, and make health even more accessible to everyone. I could not be more excited for what lies ahead.”