Not really the competition. Fossil group is Google's strongest partner for Android Wear - as everybody else is ditching the platform, Fossil is still making new ones.
Like Microsoft buying Nokia?
Fossil isn't competing with Google. They're a partner. Google doesn't even have a first-party smartwatch.
It sounds like an extremely lowball price, so either google wanted more control of ther collaboration or Fossil needed cash and wanted to kill the dept anyway.
$40 million with 100 employees? Sounds like a face-saving "successful exit"
That was my first thought. If Google wanted to go big on smartwatches, I'd have thought that Fossil was important to push WearOS for its ability to design and manufacture interesting and varied designs (a Fossil strength and Google weakpoint) but pretty much any other smartwatch manufacturer seems to have been ahead of Fossil on heart rate monitoring, tracking and sleep tech and mobile payments. So it'll be interesting to see what the R&D is all about.
Build in-house when you have the resources and time, but not the money.
Acquire when you have the money but not the resources or the time. Probably part of a larger play.
40M is probably money they found down the back of a sofa at Google. Not much for them.
How do you out-tech somebody with no tech? Google has no smartwatch division. This represents a brand new product category for them.