Amazon’s acquisition of the Roomba is dangerous
Earlier this month, Amazon announcement that he was buying the Roomba iRobot vacuum cleaner. At first glance, this move looks like a huge online retail marketplace acquiring a popular gadget to sell to its loyal buyers. Roomba is a sparkling consumer product, and iRobot has sold 40 million of them over the past two decades. Shoppers today find them occupying end caps at major retailers such as Costco and Target. The device’s smooth, rotating design has given it a sizable share of the $3 billion-a-year robot vacuum market; three-quarters of all smart vacuums sold in America carry the Roomba name. That way, the deal makes sense.
But I suspect that, for Amazon, the deal has nothing to do with cleaning your floors. What it seems to be about – extending the reach of the company further into people’s lives – should confuse everyone.
Amazon’s monopoly power looks like this: Sales on Amazon account for at least half of all online commerce in the United States three out of four product searches begin on the site. Amazon’s shipping and warehousing service delivers about a quarter of all e-commerce packages in America and is on track to overtake UPS as the second-largest consumer package delivery company after the US Postal Service. . Amazon Web Services is by far the the biggest country’s cloud computing company. Amazon Echo represents two-thirds of all smart speakers. It is by no means a complete accounting.
The iRobot deal follows a strategy known to Amazon, the one that Jeff Bezos has admitted in the past: using mergers to buy your way to dominance. (I asked Amazon if that’s what it’s doing with Roomba, but the company hasn’t commented.) Several companies make and sell robotic vacuums, including brands like Shark and others. . But Roomba is the household name, so ubiquitous that it’s shorthand for every other robot vacuum available. By simply taking over the company that makes the most popular product in the industry, Amazon can grow its monopoly without having to innovate and outperform its competitors.
Amazon can then use its gatekeeper power by bundling Roomba with its monopolistic online marketplace and Prime subscription program, leaving other vacuum cleaner brands to wither and atrophy, unable to garner attention and notoriety. owned by Roomba on the nation’s most popular shopping site.
Amazon has used a range of anti-competitive tactics to secure dominance over a variety of home technology products, all designed to bolster its smart home dominance. The company often sells its Echo smart speakers at a lossreflecting the predatory pricing strategy it used to sell layershis To light upand even his First video service to drive out his rivals and expand his primacy. Amazon could very well use the same strategy with Roomba. Combine its monopolistic retail power with below-cost pricing, and the deal becomes a competition killer.
This merger isn’t just about controlling the robot vacuum industry, or even smart home devices. Owning Roomba would give the world’s most dominant spy tech maker another portal to our homes and our lives. It could map out where we live, what we own, and what it should sell to its hundreds of millions of captured customers.
Amazon secured its dominance in home tech the same way it is expanding it now, by buying other companies. He bought voice assistant startup Evi Technologies in 2013 to help create what would become Alexa, the voice of Echo and by far the first smart voice assistant. Then, to extend its eyes and ears into people’s homes, Amazon bought two startups: camera maker Blink in 2017 and a doorbell company called Ring in 2018. Today, Ring accounts for about 40% of all video doorbells installed in America. .
These devices have given Amazon incredible access to people’s daily lives. The company has a documented history of exploiting the data its vast network of home technology captures in order to grow and expand its monopoly power. For example, Amazon has for years used Alexa’s algorithm for directing customers to Amazon’s own products. Ring monitor and record every interaction with a customer’s doorbell, including every doorbell buzz and movement near the outside of the door, and congressional investigators found that “the Ring and Blink acquisition was intended in part to expand and strengthen [Amazon’s] market power for its other businesses.
Amazon’s quest for consumer data comes with deep and real concerns about how the company uses the sights and sounds captured by its home technology products. He has in partnership with police departments across America to have its Ring doorbell installed in neighborhoods, where it is used to monitor communities without their knowledge and consent. Amazon then actions the video footage his doorbells capture with police without a warrant or permission. Its Echo speakers captured private conversations and shared them with Amazon without eavesdropping permission. (On its website, Amazon said, “On some occasions, Alexa may accidentally wake up when the wake word was not spoken, but your Echo device thought it was” and the company is “constantly improving our wake word detection technology” .)
The latest Roomba models capture information that Amazon does not currently have access to. The new from iRobot operating system maps the floor plan and content of the spaces in which it operates. The vacuum cleaners are now equipped with a camera so that they can respond to commands such as “Clean in front of the sofa”. But that means he knows what kind of sofa you have – and crib, dog bed, etc. If the deal is done, Amazon will do it too, whether or not you want Amazon to know about this stuff. (Amazon has not commented on how it would use data collected by Roombas.)
If this deal sounds bad and intrusive, that’s because it is. People buy a Roomba because they want something that will clean their floors. Most people don’t want a rotating, camera-equipped data vacuum to take stock of their home and its contents and then feed that information to the most powerful retail monopoly on the planet.
And Amazon’s data sweeps are more than scary; they are a barrier for other companies that might want to enter the smart home market. Through its acquisition of Whole Foods, its attempted takeover of One Medical and other deals, Amazon is well positioned to crush new rivals. Every piece of information Amazon collects about people’s lives – what they want to buy most, the questions they ask most often, what they keep at home – raises the barrier to a fair competition.
Regulators will scrutinize this deal closely, as they should. The direction of the United States Federal Trade Commission changes under the leadership by Lina Khan, a critique of monopoly power and of Amazon in particular. If the agency sees this deal as I do, Amazon might have to leave the floor cleaning to someone else.