Amazon’s latest acquisition brings life to the connected home
By Greg Kahn
Emerging Tech Exchange
Founder & CEO
Published on August 6, 2022
This week was packed with tech headlines, but Amazon saved the biggest news for Friday. It announced yesterday that it intends to acquire iRobot, the makers of the Roomba, for $1.7 billion. If approved by regulators, this would be Amazon’s fourth largest acquisition to date (after Whole Foods, MGM, and One Medical).
Diversification is critical for media and tech companies today. It helps limit exposure to any one area of business and creates opportunities for initiatives that could hyper-scale.
Amazon has been extremely clever and agile in its diversification strategy: logistics, media + music, cloud computing, groceries, fashion, healthcare, and now an even stronger focus on the "smart home". This market has been, and will continue to be, one of Amazon’s most important verticals.
Amazon hasn’t been able to truly capitalize on its smart home ambitions…yet. Acquisitions of Ring and Eero, the launch of Alexa and the upcoming Astro robot set the foundation. For the connected home to reach its potential, all home devices will need to operate together seemlessly.
This is in the works with a new technology connectivity standard, called Matter, which is expected to roll out later this year. Amazon, Apple, Google, Samsung and many other tech powerhouses are supporting this open-source project.
Yesterday’s announcement brought me straight back to CES 2020, when I hosted a panel with Amazon, iRobot, Procter and Gamble, Warner Media Group and McKinsey with a focus on the Connected Home. In that discussion, we agreed that, with the advance of artificial intelligence, 5G and the internet of things, companies today are no longer boxed into a confined industry or business model. There is a consensus that technology should provide a useful service to consumers and help them solve real-world problems.
At the same time, we agreed that not all tech needs to solve a problem. Devices and platforms can also be used to create moments of magic and enchantment in our homes and our lives, with industry partnerships and collaboration—even between competitors—the key to success in meeting consumer demand and user experience expectations.
PANEL HIGHLIGHTS HERE => CES 2020
In dozens of conversations I’ve had in the past few weeks, executives and journalists are discussing how brands will take their platforms of today and move them into a world of tomorrow where Web3 and hyper-connectivity prevail.
I remember not too long ago that I was having similar conversations when Web 2.0 was emerging. We were faced with technology and cultural shifts that we didn’t quite understand. They turned out to be mammoths of our very near future: Facebook, Google, Twitter, Spotify, Snap and many more.
Amazon’s announcement yesterday, fueled by some very interesting technology in development, will shape the “Future Home.” Just as location based tracking was pivotal for the rollout of Web 2.0, 3D indoor mapping and navigation will be that for Web3.
WHY INDOOR MAPPING?
According to a report by Alliedmarketresearch, “The global indoor positioning and indoor navigation market was valued at $2.6 billion in 2017 and is projected to reach $43.5 billion by 2025...growing at a CAGR of 42.0%. Not surprisingly, several companies are working on three dimensional, "vertical mapping", elevating the concept of geolocation.
Global Positioning Systems (GPS) are a critical parts of today's modern society. Beyond well-known consumer-facing applications like turn-by-turn car navigation, GPS is used for many diverse reasons...locating lost objects, timing for financial transactions, emergency response calls, synchronizing wireless networks. And yet, as our reliance on GPS grows, it has limitations. GPS doesn’t work indoors or in dense, urban areas. It can’t capture height and isn't very secure.
An indoor positioning system will help Amazon play a major role in this rapidly emerging tech area. It will help the company conceive of new product and service offerings that tap into vertical mapping. Many elements of the "metaverse" (augmented, virtual reality) rely on accurate mapping of physical spaces.
ROBOTICS AND HOME AUTOMATION
Robotics and home automation are also major factors in this Amazon - iRobot deal. Last year, Amazon announced the Astro smart home robot. Similar to Alexa, it can provide news updates, play music, and answer questions - but it can also show the weather, move between rooms on command, and recognize faces.
Earlier this year, iRobot announced the launch of its iRobot OS, an artificial intelligence platform for its devices.
Amazon’s warehouses are covered in robots and autonomous systems. iRobot’s Roomba is a natural addition to its commercial interests.
This deal announcement is way bigger than autonomous vacuums and much more complex than cross-selling home goods. Amazon’s intentions with this acquisition likely sprawls into a myriad of verticals that will unfold over the next decade.
I’m intrigued. Are you?
