SEC filing reveals Facebook was the mystery bidder against Google to acquire Fitbit, and it shows tech giants see huge growth potential for smartwatches
Category : entrepreneur
- This story was delivered to Business Insider Intelligence Connectivity & Tech subscribers earlier this morning.
- To get this story plus others to your inbox each day, hours before they’re published on Business Insider, click here.
An SEC filing revealed that Facebook was the mystery firm that bid against Google to acquire Fitbit, per CNBC, but the search giant was able to outbid Facebook’s final offer of $7.30 per share at $7.35.
Google looks set to wade into the smartwatch space in the coming years following its $2.1 billion purchase of Fitbit, though it will likely augment a few lines of Google’s overall business. But the search giant had to fend off competition from Facebook to buy the wearables company, per The Information, as some tech titans are looking to amass assets to enter the wearable space and challenge current leaders like Apple.
Primary research from Business Insider Intelligence offers a useful glimpse into why they’re looking to move into this market and provides an overview of the current landscape.
They’re looking to introduce products in a space where adoption is still low, with just 30% of US respondents to a primary research (enterprise only) study by Business Insider Intelligence, conducted using the Attest Consumer Growth Platform, reporting that they own a smartwatch. And only 43% of millennial respondents reported owning such a device, highlighting an opportunity to reach this untapped market. Respondents to the online survey were representative of the US population on the criteria of age (18-73), gender, and living area.
Apple is the clear leader in the smartwatch market currently — and no one brand is challenging it for dominance, despite the presence of key tech players in the space. Fifty-seven percent of respondents who own smartwatches say they use an Apple Watch, 16% use a Fitbit — now owned by Google — and 13% use Samsung’s product.
Devices running Google’s Wear OS smartwatch operating system total to less than 10% of smartwatches among those we surveyed. None of these offerings have resonated with consumers to the point that they’re more than niche players in the US smartwatch segment. This makes Apple’s standing in the space similar to Microsoft’s in the PC OS market in the 1990s, in that there are a handful of smaller competitors but no clear challenger.
Google and Facebook both clearly see an opportunity in the space, though, to pair their software and development expertise with hardware from an established vendor like Fitbit. Apple Watch’s appeal is limited primarily to iPhone users, who make up 54% of US smartphone users.
However, there’s no clear smartwatch leader for Android users, who make up most of the remaining share of smartphone users. Creating an attractive (and well-priced) combination of hardware, software, and services — certainly a tall order — could give Google, Facebook, or another tech titan the chance to build the premier smartwatch for Android users.
Want to read more stories like this one? Here’s how to get access:
- Sign up for Connectivity & Tech Pro, Business Insider Intelligence’s expert product suite keeping you up-to-date on the people, technologies, trends, and companies shaping the future of connectivity, delivered to your inbox 6x a week. >> Get Started
- Join thousands of top companies worldwide who trust Business Insider Intelligence for their competitive research needs. >> Inquire About Our Enterprise Memberships
- Explore related topics in more depth. >> Visit Our Report Store
- Current subscribers can log in to read the briefing here.