Google LLC, Mountain View, California, has paid Fossil Group Inc., Richardson, Texas, $40 million to acquire intellectual property related to a smartwatch technology currently under development, Wareable first reported on Jan. 17.
The transaction also stipulates that select members of Fossil's research and development team will join Google to help launch a new, innovative product related to the technology.
"We saw some technology that they were developing that we thought could be brought out in a more expansive way if Google had that technology, and was not only able to continue to use it with Fossil but bring it to other partners in the ecosystem," Stacey Burr, Google's vice president of product management, told Wareable. "It's about bringing great features to the widest numbers of on-the-go consumers."
Burr categorized the project with Fossil more as a partnership and did not confirm or deny whether or not it would lead to a made-by-Google smartwatch.
"We're very optimistic about the future of smartwatches and the role for Google, Wear OS and our partners within that evolving space,” Burr said. "This is a very vital category, and we will continue to invest and be part of this dynamic ecosystem."
Burr, a former vice president of digital sports at Adidas, is newly in charge of Google's Wear OS efforts—the company's four-year-old Android operating system. As opposed to designing its own wearable device, Google has instead focused on making Wear OS compatible with mobile phones and watches manufactured by partners such as Fossil, Motorola, Samsung and Polar.
“The latest news about Google buying smartwatch technology from Fossil is a mixed bag,” Stone Fox Capital states in a Jan. 22 column on Seeking Alpha. “On one hand, Google is getting some potentially valuable wearable intellectual property. On the other hand, the company continues to chase a category already dominated by Apple and niche players like Fitbit and Garmin.”
Fossil’s share price increased about 8 percent after the transaction.
Google's smartwatch competition remains robust but unclear. In April 2018, Fitbit announced a new partnership with Google that leverages Google's Cloud Health interface to further integrate Fitbit's services into the healthcare sector, such as connecting a user's data with electronic medial records. The companies are also using Fitbit's Twine Health platform to address chronic conditions including diabetes and hypertension.
The Apple Watch Series 4, released in September 2018, supports an electrocardiography (ECG) app and features a new fall-detection system. Both technologies have been approved by the United States Food and Drug Administration, categorizing the watch as an official class 2 medical device.
What do you think about Google’s latest acquisition? Can the company compete with Apple and Fitbit? Should it develop its own product or remain commited to Wear OS?