Newsletter
Last year, Amazon and iRobot announced a $1.7 billion acquisition, that would see Amazon swallowing up the popular robot vacuum company. As usual with these deals, they are going through regulatory reviews across the world, particularly in the UK, European Union and the US.
British regulators looked at the deal and cleared it in June, while the Federal Trade Commission in the US requested information about deal from the companies in September 2022. The European Union however, has just sent over a statement of objections to Amazon about it’s proposed acquisition.
The EU is worried about Amazon being able to squeeze out robot vacuum competition, with this acquisition. The Commission believes that Amazon might have the “ability and the incentive to foreclose iRobot’s rivals” and they could also delist rival robot vacuum cleaners or reduce their visibility on Amazon’s website. This isn’t far off from what Amazon has already done with its own brands. Finding popular products, and making a cheaper version of them under various brands including AmazonBasics.
In a statement, Amazon’s spokesperson, Alexandra Miller stated that the company will “continue to work through the process with the European Commission and are focused on addressing its questions and any identified concerns at this stage.” She continued by stating that “iRobot, which faces intense competition from other vacuum cleaner suppliers, offers practical and inventive products. We believe Amazon can offer a company like iRobot the resources to accelerate innovation and invest in critical features while lowering prices for consumers.”
Why does Amazon really want to buy iRobot?
There are a few reasons why Amazon might want to buy iRobot. But the biggest reason is likely, iRobot’s expertise with robots. Amazon already uses robots throughout its warehouses, and if it can buy a company like iRobot to produce these robots, it’d be cheaper, and easier to make.
But another reason, and this is what a lot of conspiracy theorists think, is Amazon wants an inside look at your home. iRobot’s Roomba robot vacuums do mop your home, and there has already been some accusations that iRobot has sold those maps to other companies. Of course, iRobot has denied that claim, but now Amazon could get all that data for themselves with this acquisition.
So how could this turn out for iRobot? This could be a huge boon for the company. They are currently falling behind with innovation, when compared to their competitors like Roborock, ECOVACS and Yeedi. But with Amazon’s deep pockets behind them, they could really blow past their competition, which is what the European Union is worried about. As Amazon could rank iRobot higher than their competitors on their website. Something that has been theorized for years already with many different products.