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Here’s why Amazon is acquiring iRobot for $1.7B

Photo Credit: Amazon

Amazon announced plans to acquire iRobot for $1.7B in cash recently. The home robotics company was formed in 1990 by MIT Artificial Intelligence Lab members Colin Angle, Rodney Brooks, and Helen Greiner. It is best known for inventing the robotic vacuum. The firm introduced the Roomba twelve years after its founding, a brand that has since become synonymous with the category, selling more than 30M units as of 2020.

Brooks and Greiner have gone on to create and head other firms, while Angle has stayed on as CEO – a role he will keep after the acquisition.

“Since the beginning of iRobot, our team has been on a quest to build innovative, practical products that make our customers’ lives easier, resulting in inventions such as the Roomba and iRobot OS,” CEO Colin Angle said in a statement. “Amazon shares our enthusiasm for creating meaningful technologies that enable people to do more at home, and there is no better place for our team to continue our objective.” I’m very happy to be a part of Amazon and to see what we can create for customers together in the next few years.”

The robotics market

Amazon has also been aggressively pursuing the robotics market in the decade since acquiring Kiva Systems, however, the Amazon Robotics business is entirely focused on their warehouse/fulfilment play. Recently, the company has taken modest inroads into the home with the introduction of Astro, a cheerful ‘bot that lacks the Roomba’s singular concentration.

“We realise that conserving time is important, and chores consume valuable time that could be spent doing something that consumers enjoy,” Amazon Devices SVP Dave Limp said in a statement. “For many years, the iRobot team has demonstrated its capacity to redefine how people clean with products that are incredibly practical and imaginative, from cleaning when and where consumers want while avoiding frequent impediments in the home to autonomously emptying the collection bag.” Customers adore iRobot products, and I’m delighted to collaborate with the iRobot team to create things that make their lives easier and more fun.”

Amazon and iRobot have developed an increasingly close relationship in recent years, thanks to Roomba’s adoption of Alexa features and utilisation of AWS servers.

However, despite its best efforts, the firm has had difficulties replicating the Roomba’s popularity. It has experimented with a variety of home robot services, including cleaning gutters and pools, as well as washing floors and mowing the lawn. The latter arrived in the form of Terra, which has been suspended indefinitely due to the epidemic.

Birth of iRobot

In 2016, the company spun off its military contracting division as Endeavor, which was later bought by FLIR Systems in early 2019. Ava, a telepresence robots business, was split off from iRobot a year ago. In addition, iRobot has made its own acquisitions, purchasing connected air purification firm Aeris late last year in an effort to diversify its in-home presence.

The transaction is still subject to routine regulatory review. Companies will have to demonstrate to regulators, among other things, that they are maintaining adequate privacy safeguards. For advocacy groups, Amazon’s acquisition of Ring has triggered a slew of warning lights, and its ownership of the world’s most popular in-home robot would almost surely raise eyebrows. Recent Roombas have increasingly sophisticated sensors integrated in to create 3D maps of consumers’ homes.

The transaction is one of Amazon’s largest in what has been a particularly active period for the retail juggernaut. It comes on the heels of recent multibillion-dollar agreements for OneMedical and MGM. If it goes through, the acquisition might be a watershed moment for home robots. For a decade, Roomba (and the army of robot vacuums that followed) were the only truly mainstream home robots, since Anki, Jibo, and Kuri failed to reach mainstream customers. Amazon is no doubt hoping that by acquiring iRobot, it would be able to replicate its success in industrial robotics for the home.

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