Amazon Acquires iRobot
Key Points:
- Amazon has expanded and spurred growth by acquiring a wide range of companies in various industries.
- Amazon’s purchase of iRobot is an addition to its growing array of innovative home technology.
- While many of Amazon’s acquisitions seem unrelated, they are designed to enhance its already established presence.
Over the past few years, Amazon has expanded its portfolio by acquiring other businesses. Amazon started in 1996 and is an e-commerce site offering a wide range of products and services. The company has three segments, Amazon Web Services, International, and North America. They have acquired around 90 organizations, and the company is continuing its strategic growth through acquisitions.
Amazon Acquires Roomba
Amazon has purchased a lot of organizations recently and continues to expand its diverse portfolio. In 2017, Amazon entered the grocery industry by purchasing Whole Foods for a reported $13.7 billion. In 2018, the company purchased PillPack for $1 billion, gaining a foothold in the medical industry. In addition, Amazon added MGM Studios to its long list of acquisitions in 2021 at $8.5 billion. More recently, the company has acquired iRobot, the manufacturer of the innovative Roomba Vacuum Cleaner, for a reported cost of $1.7 billion.
One exciting thing about these purchases is that Amazon reaches out to industries outside its core business. Because of the company’s strategic growth plan, these deals can’t be blocked because of monopolistic or anti-competitive reasons. There are plenty of grocery stores, so Amazon’s purchase of Whole Foods doesn’t change the industry much. There are plenty of movie studios, so owning MGM doesn’t adversely affect the movie industry. And there are plenty of businesses in the medical industry, so Amazon making one acquisition in the medical sector has little or no effect on the industry.
The company’s latest acquisition of iRobot is in that same mold. This company is one of the dozens in the United States and hundreds worldwide that make robots. iRobot manufactures the ubiquitous Roomba Vacuum Cleaner that we see advertised all the time.
No company in the robot business has a leading edge over the others. Because of this, Amazon can not be accused of trying to stamp out innovation or eliminating competitors.
Amazon’s acquisition of iRobot is also attractive because of the company’s experience with robots in its facilities. Amazon is no stranger to robots, as they have used a fleet of robotics in its fulfillment warehouses for several years.
With the acquisition of iRobot, Amazon can now turn that knowledge into another platform. The purchase of iRobot, like other past acquisitions, enables the company to expand, not necessarily in the same e-commerce space they have been growing in before.
iRobot and Roomba
The Roomba Vacuum Cleaner is now 20 years old, making iRobot one of the pioneers in the home robot industry. Roomba has been compatible with Amazon’s virtual assistant Alexa since 2017, and recently, the company revamped the operating system and introduced iRobot OS.
iRobot is a global consumer robot company that designs and builds intelligent robots and smart home innovations that make life easier and better. In 2002, iRobot introduced the first Roomba vacuum cleaner, and today, the company is a global firm that has sold millions of robots worldwide. iRobot’s product lineup features advanced technologies and concepts in cleaning, mapping, and navigation. Based on this portfolio, iRobot engineers build robots and smart home devices that help consumers make their homes easier to maintain and healthier places to live.
In 2021, iRobot introduced the Amazon Astro. The Amazon Astro can monitor your home and follow you, delivering reminders, timers, and alerts, and can also recognize faces and map your home. After the acquisition is complete and the company is integrated with Amazon’s other holdings, consumers can expect to see improved integration of Roomba products with Amazon’s virtual assistant Alexa. For example, currently, you can use an Alexa voice command to start, stop, and schedule cleaning with a Roomba vacuum or Braava jet mop.
Building a Smart Home Technology Empire
With its massive pile of cash and aggressive acquisition strategy, Amazon has positioned itself as one of the leading players in the smart home industry. The addition of iRobot creates an opportunity for Amazon to continue to expand into the consumer arena and expand its already significant presence in the world of innovative home technology.
The acquisition of iRobot is one of Amazon’s most significant, surpassing its purchase of video doorbell and camera maker Ring. The addition of iRobot complements Amazon’s massive lineup of innovative home technology. Amazon’s smart home technology includes many smart home speakers and other products, including smart home brands such as camera maker Blink Home Automation Company and mesh Wi-Fi router manufacturer Eero.
According to Dave Limp, senior vice president of Amazon Devices, “Over many years, the iRobot team has proven its ability to reinvent how people clean with products that are incredibly practical and inventive — from cleaning when and where customers want while avoiding common obstacles in the home, to automatically emptying the collection bin.” iRobot’s CEO, Colin Angle, will remain in his position, and has said that he “cannot think of a better place for our team to continue our mission.”
Amazon Acquisition of iRobot and FTC Concerns
While Amazon’s purchase of iRobot seems ideal for the company to continue its growth and expansion, the deal is receiving scrutiny from the FTC. As a result, the FTC has asked both companies to provide additional information and documentary materials concerning the merger.
Lawmakers and regulators are concerned with big tech companies, such as Amazon, developing monopolies on smart home technology that eliminate competition and enhance the company’s monopoly power. In the wake of the Amazon and iRobots agreement, several organizations, including Fight for the Future, Color of Change, and the International Brotherhood of Teamsters, voiced concerns about the acquisition. Among other matters, the group is concerned about privacy and fears the possibility of Amazon adding information about Roomba users’ homes to its vast consumer data collection.
Staying Abreast of Technology
The Roomba vacuum cleaner is cutting-edge technology, and many want these products. It’s a neat thing to have in your house, and it’s going to be something you will buy from Amazon from now on.
At Alvarez Technology Group, we strive to stay on top of everything related to technology. Our team of experts helps to protect clients from cyber risks so they can focus on their business and not worry about their system security. To learn more about how to protect your business and personal data, contact us today.
