London (CNN Business)Google’s acquisition of fitness tracking company Fitbit hit a new snag on Tuesday, as the European Commission announced it is launching an in-depth antitrust investigation into the deal.
The European Union’s top antitrust regulator said it is concerned that the takeover would further strengthen Google’s (GOOGL) market position in online advertising by “increasing the already vast amount of data that Google could use for personalization of the ads it serves and displays.”Google announced it was buying Fitbit (FIT), the world’s leading maker of wearable fitness activity trackers, in November.
The deal, worth about $2.1 billion, is one of Google’s largest acquisitions and represents an important step for the company into smartwatches and other wearable devices.The Commission had already launched a preliminary investigation into the transaction. It said a commitment by Google not to use Fitbit data for advertising purposes was insufficient to address the concerns identified in the initial probe.Read MoreThe Commission’s top antitrust official, Margrethe Vestager, said in a statement that the use of wearable devices by European consumers, as well as the data generated by them, is expected to grow significantly.”Our investigation aims to ensure that control by Google over data collected through wearable devices as a result of the transaction does not distort competition,” Vestager said.Google and other big tech companies under growing antitrust pressure in the United States and Europe. Google CEO Sundar Pichai testified last week in front of US lawmakers alongside his counterparts from Apple (AAPL), Facebook (FB) and Amazon (AMZN). In Europe, Google has already been hit with several fines for breaching EU competition law. In a blog post, Google Senior Vice President for Devices and Services Rick Osterloh said the deal “is about devices, not data,” a market he said is full of competition.”We’ve been clear from the beginning that we will not use Fitbit health and wellness data for Google ads,” Osterloh said. “We recently offered to make a legally binding commitment to the European Commission regarding our use of Fitbit data. As we do with all our products, we will give Fitbit users the choice to review, move or delete their data.”Osterloh added that Google will work with the European Commission “on an approach that addresses consumers’ expectations of their wearable devices.”
The EU investigation will last four months.— Chris Liakos contributed to this article.
Source: edition.cnn.com