Australian Regulator Rejects Google’s Undertaking for Fitbit Acquisition

Despite previously receiving conditional approval from the EU, the ACCC blocked Google’s undertaking on competition concerns.

Australia’s antitrust regulator on Tuesday blocked an undertaking from Google parent Alphabet Inc that sought to appease its concerns over Google’s planned $2.1 billion acquisition of Fitbit.

The Australian Competition and Consumer Commission (ACCC) expressed scepticism towards the Fitbit deal in June, warning that Google’s purchase of the wearables and fitness company would give it access to a significant amount of customers’ data, potentially damaging competition in health and online advertising markets.

Under its proposed undertaking, Google offered to not make use of certain user data collected through Fitbit and Google wearables for advertising purposes for 10 years, with the possibility of extension if the ACCC saw fit. It also said it would provide third parties with access to certain user data collected through the devices for 10 years, as well as maintain support for interoperability with Android devices for the same period.

However, the ACCC rejected the undertaking, stating that it continued to have concerns about the potential for Fitbit’s non-Apple rivals to be “squeezed out” of the wearables market due to their devices’ existing reliance on Google services. The regulator also noted that several other competition authorities, such as the US Department of Justice, had not yet made a decision on the viability of the deal.

“While we are aware that the European Commission recently accepted a similar undertaking from Google, we are not satisfied that a long-term behavioural undertaking of this type in such a complex and dynamic industry could be effectively monitored and enforced in Australia,” said ACCC Chair Rod Sims in a statement.

Google has faced legal challenges from the Australian government on a number of key issues, including a proposed law that would force Google and Facebook to pay for news on their platforms sourced from local media outlets. If the law is adopted, Australia will become the first country in the world to impose such a measure.

The ACCC said it would continue its investigation, setting 25 March 2021 as a new decision date.

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