Google buys Fitbit, but why?

After resisting getting properly into the wearable game for years, Google is finally diving in: it's officially acquiring Fitbit for a whole $2.1 billion, which seems like a steal given it was valued at $10 billion just a few years ago.

The lack of a Google wearable, and rumors that one is coming, has been long pondered, but the 'Pixel Watch' never emerged. Perhaps it was a lack of sales for the Pixel line of phones, or maybe that renewed push for focus internally was paying off, but given the Apple Watch's success in the industry, it seemed like an odd gap.

The question, in my mind, is what the heck Fitbit adds to the Google portfolio? It's merging with the Google hardware division, not the awkward 'owned by Alphabet' arrangement that kneecapped Nest for years, but a part of the core strategy going forward.

At first, I figured this was about advertising and health data, but Google (wisely) says that's not the case, noting that "Fitbit health and wellness data will not be used for Google ads." 

If that's the case, this is a obvious play for the "Android" model in fitness devices. Sensing that Apple is running away with the industry, Google sees an opportunity to build the competition out by bringing Fitbit in house and demonstrating what the 'best' wearOS hardware could be, which could, in theory, convince the wider industry to invest more in the Google wearable platform, and to compete better.

The problem with the Apple Watch is that it's an existential threat hiding in plain sight. If there are no good wearables except the Apple Watch, it helps make the iPhone stay sticky for those already using it, and tempts Android users looking for a health-focused device away from Android.

That's the issue: there is plenty of desire out there from the billion-plus Android users to get a watch of their own, but incredibly slim high-end choices outside of the Apple Watch. Fitbit was the most obvious, well-known player in this space, despite its struggles to find a comfortable spot in the industry.

A similar model was used by Microsoft with the Surface line of hardware to disrupt its own PC market, and stem the attrition to the Mac by providing the best-of-breed hardware PC makers should be aspiring to beat, rather than just making the same old thing.

In the same way that Android is designed for everyone, at all price points, the Fitbit acquisition will be positioned as health wearables for anyone. When the Google wearable arrives, you can bet the pricing will be aggressive, and it'll work with any device, which will stand in stark contrast to the Apple Watch. 

What will be telling, however, is if it's any good, which Google often takes a few years to get right (if at all, which was the case with Motorola, back in the day). I'm not optimistic that Fitbit is the right fit‚ÄĒif the company was struggling, is that a good sign that it knows how to make something that people want? That doesn't seem like a healthy way to start a new hardware division.

On the other hand, perhaps this is all about people and that delicious patent hoard the company has amassed, and nothing more. We won't know the fruits of this for years to come, and like with Nest, it's hard to know what 'success' really looks at.


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