In my blog note this morning, I discussed my interpretation of the emerging "wearable health ecosystems" (see: The Evolution of "Wearable Health Ecosystems" and Associated Partnerships)." I cited the examples of Apple, Fitbit, and Sony with its newly released, connectivity oriented mSafety wearable (see: Sony Develops Health Wearable Providing Connectivity, Stipulating That It's Not a Smartwatch). I have just learned that Alphabet, the parent company of Google, has made an offer for Fitbit (see: Alphabet makes bid for Fitbit as it eyes wearable market). Below is an excerpt from the article:
Google owner Alphabet has made an offer to acquire US wearable device maker Fitbit, as it eyes a slice of the crowded market for fitness trackers and smartwatches....While Google has joined other major technology companies such as Apple and Samsung Electronics in developing smart phones, it has yet to develop any wearable offerings.There is no certainty that the negotiations between Google and Fitbit will lead to any deal....A deal for Fitbit would come as its dominant share of the fitness tracking sector continues to be chipped away by cheaper offerings from companies such as China’s Huawei Technologies and Xiaomi. Fitbit’s fitness trackers monitor users’ daily steps, calories burned and distance traveled. They also measure floors climbed, sleep duration and quality, and heart rate. Fitbit, which helped pioneer the wearable devices craze, has been partnering with health insurers and has been making tuck-in acquisitions in the healthcare market, as part of efforts to diversify its revenue stream. Analysts have said that much of the company’s value may now lie in its health data.
I have posted a number of notes about the entry of Big Tech into health, eyeing the large percentage of GDP allocated to health in the U.S., the explosive growth of consumer-facing wearables, and the high value of the data collected by wearables connected to smart phones (see: What Are the Consequences of Big Tech Entering the Healthcare Market?; Big Tech Is Knocking on Hospital Doors; It's All About the Data; Healthcare Will Contribute a Sizable Portion of Future Earnings for Apple). We will see where all of this ends up. It will be interesting to see if wearable health ecosystems are ultimately dominated by tech giants Apple and Google and how the large health systems and the leading health insurance companies react to this situation.
Update November 1, 2019 @ 12:08 ET: Google buys Fitbit for $2.1 billion