EU launches ‘in-depth’ investigation of Google bid for Fitbit

EU competition commissioner Margrethe Vestager. (AFP)
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Updated 05 August 2020

EU launches ‘in-depth’ investigation of Google bid for Fitbit

BRUSSELS: The European Commission launched an “in-depth investigation” on Tuesday into whether US tech giant Google’s planned $2.1 billion purchase of smartwatch maker Fitbit would give it an unfair market advantage.
“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,” EU competition commissioner Margrethe Vestager said.
In November last year, Google announced it had reached an agreement to buy Fitbit, which produces wearable fitness trackers and watches that communicate with a health monitoring app.
But Google’s own smartwatch performs a similar function and Brussels is concerned that acquiring Fitbit’s user data will strengthen its already powerful position in targeted advertising.
“The use of wearable devices by European consumers is expected to grow significantly in the coming years,” Vestager said in a European Commission statement announcing the probe.

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Google announced in 2019 that it had reached an agreement to buy Fitbit, which produces wearable fitness trackers and watches that communicate with a health monitoring app. But Google’s own smartwatch performs a similar function and Brussels is concerned that acquiring Fitbit’s user data will strengthen its already powerful position in targeted advertising.

“This will go hand in hand with an exponential growth of data generated through these devices. This data provides key insights about the life and the health situation of the users of these devices.”
Google has promised not to use Fitbit health data for Google ads, but the buyout has attracted concerns from consumer groups and Australia’s competition commission.

The European Commission now has 90 working days — or until Dec. 9 — to carry out the investigation and decide whether to impose new conditions on Google.

Brussels has acknowledged that Google has created a data silo to keep users’ health data separate from its advertising platforms.
But it warned “that the data silo commitment proposed by Google is insufficient to clearly dismiss the serious doubts identified at this stage as to the effects of the transaction.
“Among others, this is because the data silo remedy did not cover all the data that Google would access as a result of the transaction and would be valuable for advertising purposes,” the statement said.


Bailout will keep Air France-KLM afloat for less than year: CEO

Updated 21 September 2020

Bailout will keep Air France-KLM afloat for less than year: CEO

  • ‘If we base it upon the past few weeks, it is clear that the recovery in traffic will be slower than expected’
  • Governments are coming under pressure to tie airline bailouts to environmental commitments

PARIS: Bailouts provided to Air France-KLM by the French and Dutch governments will keep the airline flying less than a year, its CEO Benjamin Smith said Monday and evoked the possibility of injecting new capital.
In an interview with the French daily l’Opinion, Smith also warned that calls for airlines to contribute more to fight climate change could be catastrophic for their survival which is already under threat due to the coronavirus pandemic.
When countries imposed lockdowns earlier this year to stem the spread of the coronavirus airlines faced steep drops in revenue that have claimed several carriers.
A number of countries stepped in with support, including France which provided $8.2 billion to Air France and the Netherlands which received a $2.9 billion package.
“This support will permit us to hold on less than 12 months,” said Smith.
The reason is that air traffic is picking up very slowly as many northern hemisphere countries are now fearing a second wave of infections.
“If we base it upon the past few weeks, it is clear that the recovery in traffic will be slower than expected,” according to Smith, who said when the bailout was put together the airline was expecting a return to 2019 levels only in 2024.
Smith said discussions were already underway with shareholders on shoring up the airline group, and steps would be taken before the next regular annual meeting in the second quarter of next year.
“One, three or five billion euros? It is too early to put a figure on a possible recapitalization,” he said.
The airline group had $12.12 billion in cash or available under credit lines.
Major shareholders include the French government with a 14.3 percent stake, the Dutch government at 14 percent, as well as Delta and China Eastern airlines which each hold an 8 percent stake.
Governments are coming under pressure to tie airline bailouts to environmental commitments.
One proposal that has come from a citizen’s convention convoked by President Emmanuel Macron would cost airlines an estimated $3.6 billion.
Smith said the imposition of environmental charges on the industry would be “irresponsible and catastrophic” for Air France-KLM.