July 15, 2020 | Telecom | North America | Ended

Fitbit / Alphabet: Fitbit’s Data and its Conglomerate and Vertical Effects

Google’s acquisition of wearable maker Fitbit is being scrutinised by global antitrust regulators on conglomerate, vertical and horizontal grounds. Simultaneously, some of the same regulators are investigating Google and Big Tech on alleged violations of antitrust laws, data accumulation and privacy breaches. Although the merger and Big Tech antitrust reviews will remain mutually exclusive, they are linked, whereby the regulators are concerned that Google is being less than transparent on what it plans to do with its accumulated data. In this report, we examine the conglomerate, vertical and horizontal antitrust effects of Fitbit / Google and discuss whether remedies will be enough to appease regulators and allow Google to ultimately own a wearable maker, access to vast amounts of health data and maintain its operating system for wearables. We identify which companies will be harmed in absence of antitrust action and the deal’s effects on online advertising participants, search competitors and wearable manufacturers.

Contents 1. How Fitbit Adds Value Across Alphabet’s Portfolio 2. Impact of a Potential US Federal Antitrust Case Against Google 3. Data Accumulation and Where Antitrust Regulators Stand 4. Conglomerate Effects and Scrutiny: Health Data Influencing Ad Tech 5. Vertical Effects and Scrutiny: Wearables’ Operating Systems 6. Horizontal Effects and Scrutiny: Health Data Supplying Businesses 7. Our Expectations of Antitrust Outcomes 8. Fitbit Break Price Analysis 9. Risk Arbitrage Trading Considerations Appendix A. Google Platforms: Search versus Digital Advertising Markets (44 pages)

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