The U.S. Justice Department will review plans by Google to buy fitness tracker maker Fitbit for possible antitrust issues, according to multiple media reports.
The Alphabet-owned company announced Nov. 1 plans to acquire the wearables giant for $7.25 per share in cash, valuing the company at $2.1 billion. The deal would give Google a leg up to compete against Apple and Samsung in the competitive market for fitness trackers and smartwatches.
The New York Post reported Tuesday that the deal will face DOJ scrutiny amid data privacy fears, citing a source close to the situation.
"The controversial merger in recent days was cleared for review by the DOJ after federal law enforcement tussled with the Federal Trade Commission, which had also sought authority to investigate the deal," The New York Post reported, citing sources.
Both agencies are concerned that a Google-owned Fitbit would give the search giant an even bigger window into people’s private data, including sensitive health information, sources said, according to the report.
The DOJ also is presently investigating Google for broader anti-competitive issues. In September, it asked Google for documents related to past FTC antitrust investigations. That larger investigation was the main argument the DOJ made when asking for the Fitbit review in what a source described as a real “arm-wrestle” between the agencies, The New York Post reported.
Reuters also reported that a source confirmed that the DOJ plans to review the deal for possible antitrust issues.
Watchdog groups like Public Citizen and the Center for Digital Democracy, among others, have urged antitrust enforcers to block the deal on the grounds that it will give Google even more data about American consumers, Reuters reported.
Google also is facing heat over privacy concerns related to a health data partnership with Ascension Health. Federal lawmakers and the U.S. Department of Health and Human Services Office for Civil Rights (OCR) are pressing for more information about how the company will collect and use sensitive health data as part of that project.
Fitbit launched in 2007 and was considered a pioneer of the consumer fitness tracking market, quickly becoming the market leader. Other players have since entered the market including Apple, Garmin and Samsung.
At the time the deal was announced, Rick Osterloh, senior vice president, devices and services at Google said the tech giant plans to bring leverage Fitbit's capabilities to bring together the "best hardware, software and AI to build wearables to help even more people around the world."
Fitbit and Google executives have said strong privacy and security guidelines will continue to be a major priority.
Google will never sell personal information to anyone and Fitbit health and wellness data will not be used for Google ads, Fitbit and Google executives said. Fitbit users will have the choice to review, move or delete their data, according to the companies.
Google's new healthcare hire
The search and advertising giant continues to build a deep bench of healthcare leaders and medical experts. The company has hired Jacqueline Shreibati, M.D., the chief medical officer for medical device and artificial intelligence (AI) startup AliveCor, Google confirmed Wednesday.
Shreibati has joined Google Health's clinical team, which is led by chief health officer Dr. Karen DeSalvo, Google spokesperson Iz Conroy told FierceHealthcare.
At Google, Shreibati will help the company with its health research efforts, CNBC reported, according to a person familiar with the matter.