Amazon to buy vacuum maker iRobot for roughly US$1.7B

NEW YORK –

Amazon announced Friday that it had agreed to buy the vacuum cleaner manufacturer iRobot at a price of approximately US$1.7billion. This acquisition comes amid wider concerns about Amazon’s market power and adds to Amazon’s collection of smart home appliances.

iRobot sells their products around the globe. The most well-known product is the circular-shaped Roomba vacuum.

Amazon is trying to take over a part of the home market through services, and it will accelerate its growth. said Neil Saunders, managing director at GlobalData Retail. GlobalData Retail’s tech arsenal now includes a variety of robots that clean homes. This makes it more involved in the lives of consumers beyond voice control and static voice commands.

Amazon’s Astro robot, which assists with tasks such as setting alarms, was announced last year at a $1,000 introductory price. Its rollout has been slow and received very little response.

The company hasn’t been very successful with household robots but the iRobot purchase and the company’s strong market reputation give a “massive footprint in the consumer robotics market” that could help Amazon duplicate the success of its Echo smart speakers. said Lian Jye, a robotics industry analyst at ABI Research.

Su said It also highlights the flaws of consumer robots vendors like iRobot. These companies struggled beyond a niche product, and were in a race-to-thebottom competition with Korean and Chinese producers offering cheaper versions.

Friday saw iRobot report its quarterly results. The company announced it was cutting 10% of its workforce after revenue plunged 30% due to order cancellations and delays.

Amazon said It will buy iRobot at $61 per share in an all cash transaction that will also include iRobot’s net debt. As of July 2, the company had a total current debt of $332.1million. The deal requires approval from shareholders and regulators. Colin Angle, iRobot’s CEO, will still be in place upon completion.

Suspiciously, iRobot’s robotics platform has been hosted on Amazon’s cloud service unit AWS since many years. said This acquisition could result in more integration of Amazon speech recognition and additional capabilities into vacuums.

iRobot shares rose 19% in midday trading. Amazon shares were down 1.4%

Anti-monopoly advocates continue their concerns about Amazon’s increasing dominance. The acquisition of iRobot by Amazon is the fourth largest, following Whole Foods’ $13.7 billion purchase in 2017. The company was acquired by iRobot last month. said It would purchase One Medical, the primary care provider for health care, in a deal worth approximately $3.9 billion. This move will expand its reach into health care.

Groups calling for tighter antitrust regulations urged regulators to stop the iRobot merger on Friday. They argued that it allows Amazon more access to consumers and increases its market dominance in smart home markets.

Amazon taking even more of our personal data is not what America or the world needs. said Robert Weissman is the president of Public Citizen, a progressive consumer rights advocacy group.

Weissman stated, “This is not about Amazon selling another product in its marketplace.” said. It’s all about the company getting more intimate details about our lives in order to gain an unfair market advantage. sell Get more!

As the prospects of getting votes from either the full Senate or House on landmark antitrust legislation against Amazon and other Big Tech companies have dimmed, Congress has let this go for months.

Sen. Amy Klobuchar of Minnesota, who is the head of the Senate Judiciary antitrust committee, requested that the Federal Trade Commission investigate the One Medical acquisition. She was following the lead of other critics, who called for the Federal Trade Commission’s investigation. The purchase was halted over concerns about Amazon’s past conduct and potential implications to consumers’ health data. Amazon’s $8.5B buyout of Hollywood studio MGM (which was completed earlier in the year) is also up for review by regulators.

Founded in 1990 in Boston by three Massachusetts Institute of Technology roboticists including Angle, iRobot began with rovers that could carry out military and disaster-relief missions in the aftermath of September 11, 2001.

iRobot was able to use the profits from defense contracts to test a variety other robots. Some duds were produced, but one great commercial success was the Roomba. This Roomba, introduced 2002, set the standard for automated vacuum cleaners.

In 2016, the company disbanded its defense robotics division to focus almost exclusively on selling vacuums and other home robots such as Braava’s robotic mop. It had planned to launch its robotic lawnmower in 2020. However, it backed out citing pandemic problems.

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This report was contributed by Matt O’Brien, AP technology reporter from Providence, Rhode Island