Amazon recently announced they would acquire iRobot, the company behind the consumer robot vacuum cleaner for $1.7bn.
Why did Amazon acquire iRobot?
Whilst Amazon already have one of the largest robot workforces globally in its warehouses, the iRobot acquisition is unrelated to this part of Amazon.
STIQs view is that Amazon has a view of how future consumer dwellings/homes will be reliant on smart devices connected to a software ecosystem, such as Amazon's Alexa assistant.
Amazon internal initiatives high failure rate?
Amazon has already attempted to develop applications internally, such as Dash Buttons (discontinued, source), Astro (source), etc. but most of these appear to have failed. So, instead of developing devices internally, the company has resorted to acquisitions.
Amazon Marketplace key to acquisitions?
One of the key advantages Amazon hold is its sales data of how Ring and iRobot products (among others) perform on their marketplace. In addition, Amazon also know the competitor products and performance. This is super valuable information that any other acquirer would not have access to easily (or at all) and provides Amazon with a huge M&A transaction advantage.
Screenshot from Amazon re Robotic Vacuum cleaners
Amazon related acquisitions
STIQs view is that Alexa will play an increasingly important role for Amazon in its smart home strategy.
Shortly, users of Roomba and other iRobot devices will be able to remote control these via the Alexa interface.
What will Amazon acquire next?
Following STIQs analysis in building a smart home ecosystem around Alexa and having acquired a vacuum company, the next acquisition may be an outdoor robot company, such as a lawn mover or similar.
In the longer term, Amazon may want to own a white goods vendor. However, it might settle for owning the orchestration engine [Alexa] for larger components, such as white goods.
Your views? Agree/disagree?
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