Why is Amazon acquiring Roomba

Amazon (AMZNThe Alexa-powered empire is about to get a lot bigger. E-commerce giant and smart home Friday announced that it is buying iRobot Roomba Maker (IRBT) for $1.7 billion. The move means Amazon’s line of connected devices will soon include everything from smart vacuum cleaners to air purifiers.

It also comes at a time when Amazon is moving its Alexa-enabled devices from stationary objects like smart speakers to mobile devices that can follow you around your home and respond to your commands at any moment.

Amazon is clearly investing heavily in the future of the smart home, and although the robotic vacuum space is competitive, with this deal, Amazon has gained and enhanced its expertise, analyst Raymond James Brian Gesuale wrote in an Aug. 5 note.

“There are major players in the robotic vacuum space such as LG, Samsung, Shark and a host of others creating a competitive market that has seen prices and margins plummet over the past few years with no end in sight,” he wrote.

“The broader smart home ecosystem has a broader set of competitors. Amazon is small in the robotics market with its recently launched Astro product, so in the near term, it is about integrating the channel vertically as it develops a long-term plan for smart home and data attached.”

But it’s not just about building smarter devices. The acquisition of Amazon is part of its broader strategy to try to ensure that its flagship service is always on top of consumers’ minds, and by selling more physical products that connect to the platform, it can do just that.

Bring the members of the Prime Minister

Amazon’s ultimate goal for its e-commerce business is to get everyone on its Prime platform. The service, which costs $14.99 per month or $139 per year, gives subscribers access to everything from next-day delivery and Prime Video to Prime Music and Twitch.

Of course, people who subscribe to Prime are also more willing to purchase their goods through Amazon, which is a double blessing for the company. After all, Amazon takes the monthly or annual fee, and then you get a portion of the products you buy.

Amazon acquires iRobot for $1.7 billion. (AP Photo/Eugene Hoshiko)

Special Amazon products like Echo speakers are set up to motivate you to sign up for Prime, too. After all, it’s easy to quickly ask Alexa to buy you something or play a song through Prime Music if you’re a Prime subscriber.

IRobot also offers more than just a Roomba broom. The company also sells the Braava Jet smart mop and handheld vacuum cleaner. The company had previously been working on a smart lawn mower, but has dismissed the idea.

However, the current iRobot wallet gives Amazon another way to convince customers to sign up for Prime.

Building better robots

However, IRobot’s products will also help Amazon build its own line of robots at home. Currently, Amazon offers Her bot named Astro. A sort of Alexa on wheels, the little robot is currently available for purchase by invitation only and costs $999. If and when Astro becomes available to the entire public, it will cost $1,499.

Unspecified - Sep 28: In this screenshot, Senior Vice President, Hardware &  Services, Dave Limp introduces Amazon Astro during an announcement of Amazon Devices and Services on September 28, 2021 (Photo by Jimmy McCarthy/Getty Images)

Amazon Senior Vice President of Hardware and Services, Dave Limp Introducing Amazon Astro in 2021 (Photo by Jamie McCarthy/Getty Images)

Astro’s main functions include the ability to follow you to allow you to listen to podcasts and music, bring small items to people in your home via a small enclosure installed in the back, let you use it manually to check into your home when you’re away, and act as a security guard by patrolling your home at night .

So far, though, Astro appears to be a half-baked robot with an uncertain direction. Reviews of CNET, The Wall Street Journal, and TechCrunch point to the fact that Astro isn’t great at many of the things it’s meant to do. Reviewers point to everything from a robot having trouble deciding the layout of a house to simply standing in the way.

There’s also the problem that Astro doesn’t make the stairs. It cannot go up or down on them. So it’s stuck on one floor in your house.

Astro isn’t the only in-house robot from Amazon. Ring trading company has its own security drone called Always home cam It can take off when a security alert is triggered or be remotely controlled as a flying camera. Also available by invitation only, the Always Home Cam is $249.

While iRobot devices focus more on single tasks like vacuuming and mopping, the company’s technology could be particularly useful for Amazon as it builds its own robotics capabilities for the home.

The iRobot acquisition will also be central to Amazon’s data collection efforts. Roombas creates maps of your home, so the device knows where it is, where it’s headed and how clean those rooms are, said Ian Greenblatt, who leads the technology, media, and telecommunications intelligence practice at JD Power.

“It’s another sensor platform, not unlike Ring, Alexa, or even retail history,” Greenblatt said. “You have to keep in mind that all of this together creates a hologram of a person. With Roomba, it is now moving around your house.”

It’s also worth noting that iRobot devices are already Alexa-capable, which means you can tell your vacuum cleaner to clean an area with Alexa, and it will take off and get to work. So it makes sense that the iRobots experts already know about Amazon’s technology.

Ultimately, the fact that Roomba is mobile matters — even though Amazon has many in-house robots, this acquisition will help Amazon achieve “the next generation of robot companions in the home, among other opportunities,” Greenblatt said.

Got a tip? Email Daniel Hawley at dhowley@yahoofinance.com. Follow him on Twitter at Tweet embed.

Allie Garfinkle is a senior technical reporter at Yahoo Finance. Find her on Twitter Tweet embed.

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