Why is Amazon buying Roomba?

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

It also comes at a time when Amazon is working to move its Alexa-enabled devices from stationary objects like smart speakers to mobile machines that can follow you throughout your home and respond to your commands at a moment’s notice.

It’s clear that Amazon is heavily invested in the future of smart homes, and while the robot vacuum space is competitive, with this deal Amazon has acquired and strengthened its expertise, Raymond James analyst Brian Gesuale wrote in an Aug. 5 note.

“There are big players in the robot vacuum space like LG, Samsung, Shark and a host of others creating a competitive marketplace that has seen price and margins compress over the past few years with no end in sight,” he wrote.

“The broader smart home ecosystem has an even broader set of competitors. Amazon is small in the robotics market with its recently launched Astro product, so in the short term it’s more about vertical integration of the channel as it develops a long-term plan for the smart home and attached data .”

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

Bringing in Prime members

Amazon’s ultimate goal for its e-commerce business is to get everyone onto the Prime platform. The service, which costs $14.99 per month or $139 a 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 likely to buy their items through Amazon, which is a double boon for the company. After all, Amazon gets your monthly or annual fee and then gets a cut of the products you buy.

FILE - A Roomba 980 vacuum cleaner robot is presented during a presentation in Tokyo, Tuesday, September 29, 2015. Amazon announced on Friday, 5  August 2022 that they have entered into an agreement to buy the vacuum cleaner manufacturer iRobot for approx.  1.66 billion dollars.  The company sells its robots all over the world and is best known for the circular vacuum cleaner Roomba.  (AP Photo/Eugene Hoshiko)

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

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

IRobot also brings more than just the Roomba vacuum cleaner. The company also sells its Braava Jet smart mop and handheld vacuum cleaner. The company previously worked on a smart lawnmower, but rejected the idea.

Still, iRobot’s existing portfolio gives Amazon another opportunity to persuade customers to sign up for Prime.

Build better robots

However, iRobot’s products will also help Amazon build out its own collection of robots in the home. Currently, Amazon offers its own robot called Astro. A kind of Alexa on wheels, the little robot is currently only available for purchase via invitation and costs $999. If and when Astro becomes available to the general public, it will cost $1,499.

UNSPECIFIED - SEPTEMBER 28: In this screenshot, Senior Vice President, Devices & Services, Dave Limp introduces Amazon Astro during the Amazon Devices and Services Announcement on September 28, 2021. (Photo by Jamie McCarthy/Getty Images)

Amazon senior vice president of devices and services Dave Limp introduces Amazon Astro in 2021. (Photo by Jamie McCarthy/Getty Images)

Astro’s main features include being able to follow you around to let you listen to podcasts and music, bring small items to people in your home via a small rear-mounted container, let you use it manually to check in on your home when you’re away, and act as a security guard by patrolling your home at night.

So far, however, Astro appears to be a half-baked bot with an uncertain direction. Reviews from CNET, The Wall Street Journal, and TechCrunch all point to the fact that Astro isn’t very good at the many things it’s supposed to do. Reviewers point to everything from the robot having difficulty determining a home’s layout to simply getting in the way.

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

Astro is not Amazon’s only robot in the home. The company’s Ring business has its own flying security drone called the Always Home Cam that 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 costs $249.

While iRobot’s devices are more focused around individual tasks like vacuuming and mopping, the company’s technology could prove particularly useful for Amazon as it builds out its robotics capabilities for the home.

The acquisition of iRobot will also be key in Amazon’s data collection efforts. Roombas map your house, so the unit knows where it’s been, where it’s going, and how clean the rooms are, said Ian Greenblatt, who leads JD Power’s technology, media and telecommunications intelligence practice.

“It’s another sensor platform, not unlike Ring or Alexa or even your purchase history,” Greenblatt said. “You should bear in mind that all of this together creates a rather three-dimensional image of a person. With Roomba, it now moves around your house.”

It’s also worth pointing out that iRobot’s devices are already Alexa-compatible, meaning you can tell the vacuum to clean an area using Alexa and it will take off and start working. So it is natural that iRobot’s own experts are already quite familiar with Amazon’s technology.

Ultimately, the fact that Roomba is mobile is a big deal—even though Amazon has many robots in the home, this acquisition will help Amazon bring about “the next generation of robotic companions in the home, among other possibilities,” Greenblatt said.

Do you have a tip? Email Daniel Howley at dhowley@yahoofinance.com. Follow him on Twitter at @DanielHowley.

Allie Garfinkle is a senior technical reporter at Yahoo Finance. Find her on Twitter @agarfinks.

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