The big picture: Google says it didn't buy Fitbit to get access to the health and fitness data of millions of users. The EU wants the company to prove its good intentions, which involves refraining from using that information to enhance Search, as well as sharing it with its competitors.
Google bought Fitbit last year for $2.1 billion as part of its renewed strategy to grow and improve the Wear OS ecosystem with more fitness tracking and wellness features. While this made Fitbit's investors happy, it raised many questions about user privacy, as Google's advertising business is dependent on gathering as much data as possible on users.
At the time, it was clear for both companies that the acquisition would be a gradual process that involved getting the necessary regulatory and shareholder approvals. Google had already become the subject of a broad antitrust probe with regulators looking closely into the search giant's many past acquisitions.
In the EU, officials have sent 60-page questionnaires to Google and Fitbit's competitors in the health and wellness market to see whether the acquisition could put them at an unfair disadvantage.
These concerns are echoed by Australia's Competition and Consumer Commission, as well as the US Department of Justice, who also want to know whether Google can effectively use Fitbit's treasure trove of user data to strengthen not only its Health division, but also its online advertising business.
According to a report from the Financial Times, EU regulators have asked Google to pledge that it won't tap into Fitbit data to "further enhance its search advantage." Additionally, the officials have demanded the company open up access to that information to third parties.
Last month, several consumer privacy organizations across the US, Canada, Mexico, Brazil, and the EU called for a temporary block on the Fitbit buyout, noting that Google has a track record of aggressive data collection and strategic acquisitions that have allowed it to achieve a dominant position in certain markets.
Google's position on the matter is that it bought Fitbit to strengthen its hardware efforts, not to get access to the fitness and health data of over 29 million users. The company says users can expect to have the same choice to review, move, or delete their information as they do with any other Google service.
Still, if Google refuses to make the required concessions by August 8, the investigation could drag on for years, making it more difficult for the EU to block what appears to be a vertical merger.