This is how Amazon sneaks into 40 million households

The black and gold vacuum cleaner robot works its way purposefully through the living room, leaving no corner unattended and skilfully avoiding obstacles such as table legs or multiple sockets.

This is how Amazon sneaks into 40 million households

The black and gold vacuum cleaner robot works its way purposefully through the living room, leaving no corner unattended and skilfully avoiding obstacles such as table legs or multiple sockets. Roomba S9 is the name of the device from the manufacturer iRobot.

It not only vacuums, but also creates an exact digital map of the respective room with cameras and laser sensors. It is precisely this ability that makes iRobots devices interesting not only for users who are lazy about vacuum cleaners, but also for the online giant Amazon.

The group wants to take over iRobot completely and has announced a purchase offer of 1.7 billion dollars. The price seems almost cheap for what Amazon CEO Andy Jassy could get here if regulators approve the deal.

iRobot is currently the most successful manufacturer of home robots, with more than 40 million devices sold. This gives Amazon access in more than 40 million households that no other company has: Firstly, the customers have an above-average affinity for technology and have purchasing power, secondly, they are willing to let a robot equipped with sensors and cameras into their home.

Jassy not only buys a robot company, he buys a wealth of data that cannot be found anywhere else on the market: robots like the Roomba S9 know how big their users' apartments are, they know the interior design and know when someone is home is and when not. The home robots could be one of the most important building blocks in the competition for the smart home market in the future.

As early as 2015, Amazon recognized the smart home as a playing field on which no mega-corporation has been able to establish a dominant technology standard to date. At that time there was no kind of standard operating system, an overarching software for controlling the various applications, such as Microsoft's Windows for PC.

Amazon took the opportunity and taught its smart assistant Alexa how to control home devices by voice. In the meantime, he not only masters light control, but can also evaluate sensors for home surveillance, control heating or greet visitors via video doorbell.

But Google also recognized the possibilities hidden in the operating system for the Smart Home at the time - and taught its assistant similar skills.

In addition, Google has a decisive advantage: Every Android smartphone already contains sensors and cameras for light, temperature and position, which make smart home control easier. Amazon lacks this direct mobile access. The iRobot acquisition could change that, because every robot provides countless data for the smart home control.

If you want to see how iRobots future robots in Amazon's services can no longer just vacuum, but can also take on multiple other functions, you only have to look at Amazon's own robot experiments: Astro is the name of a device that Amazon has so far only sold to selected test customers.

Astro can't vacuum or mop, but he monitors the home with his sensors and is integrated with Amazon's Ring security system for the smart home. It reacts to sensors and surveillance cameras like a watchdog and provides its owner with camera images of its journeys through the home.

Amazon is a master at combining different functions and services on one offer or device and, thanks to mixed calculations, setting prices that drive competitors out of the market: Amazon Prime combines express shipping with a music and video subscription, Amazon's Alexa devices combine loudspeakers for Music with smart home functions or digital picture frames. The willingness of customers to pay for one function alone is relatively low – but Amazon is more successful than its competitors with a combination offer.

A future Roomba robot could not only vacuum, but also function as an Alexa base, use sensors to search for burglars or receive Prime packages. Prime customers could book a Roomba subscription or get the robots cheaper - Amazon's combination options should already make the competition sweat.

It is questionable whether Amazon is smart enough to include the competition from Google in its offers. Because so far, the Roomba robots have been listening to both voice commands via Amazon's Alexa and via Google's Assistant. Should Amazon exclude the competition's assistant from its Roombas in the future, the acquisition would be a prime case for the competition authorities.

But this is exactly where the smart home market has so far differed pleasantly from the closed smartphone ecosystems with their app stores: Most devices are compatible with Alexa as well as with the Assistant or Apple's Siri.

Many smart home devices with the upcoming common standard "Matter" have already been announced at the next Berlin technology fair IFA. Despite the competition, manufacturers have so far avoided excluding their competitors. The iRobot acquisition could therefore become the litmus test for the future of the smart home market.

"Everything on shares" is the daily stock exchange shot from the WELT business editorial team. Every morning from 7 a.m. with the financial journalists from WELT. For stock market experts and beginners. Subscribe to the podcast on Spotify, Apple Podcast, Amazon Music and Deezer. Or directly via RSS feed.

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