Amazon dominates smart home,now privacy groups oppose iRobot deal
Since Amazon introduced the Echo smart speaker in 2014, it has remained the largest and fastest growing player in the smart home market.
Its most recent expansion includes four new Echo devices, a new Fire TV, two new Ring cameras with features such as radar-triggered motion detection and Halo Rise contactless sleep tracking that can detect your breathing and movements to determine sleep stages.
The new devices were all presented on Wednesday at Amazon’s annual smart home event.
Amazon Halo Rise sleep tracking
Last month, Amazon took steps to enter a new smart home segment, with a $1.7 billion offer to buy iRobot, the maker of the Roomba smart vacuum cleaner.
Now the Federal Trade Commission is asking for more information from both iRobot and Amazon before deciding whether to approve the deal.
Earlier this month, 20 privacy and labor groups sent a letter to the FTC asking it to block the acquisition. The letter cited concerns about privacy and Amazon’s growing dominance in the smart home market.
“Amazon takes its responsibility to customers and privacy incredibly seriously.
And if we were to acquire iRobot or any other company, that wouldn’t change,” said Leila Rouhi, Amazon’s vice president of trust and privacy.
Amazon claims that 140,000 products are now compatible with Alexa, although “very few” of them belong to the company.
He acquired the manufacturer of video doorbells Ring for $ 1 billion in 2018, just three months later he bought the manufacturer of security cameras Blink for $ 90 million.
Then in 2019, he paid $97 million for a mesh Wi-Fi system called Eero to help connect multiple smart devices at home.
Amazon’s Eero mesh WiFi systems are shown in Amazon’s smart lab in Seattle, Washington, September 9, 2022.
“Eero was a crucial acquisition because it gave Amazon this ability to see which devices and devices are being used. They can see the Internet traffic that goes to every connected item in someone’s house. And that gives you a lot of ideas.
And I’m sure part of the information Amazon got from it was how popular Roombas are and how often they are used,” said Stacy Mitchell of the Institute for Local Self-Reliance, one of the advocacy groups that signed the letter to the FTC.
Marja Koopmans, director of Smart Home at Amazon, told CNBC that the data from its devices is only used to improve the capabilities of its interconnected smart home ecosystem.
A growing market
When Amazon became the first major player to introduce a smart speaker to the market in 2014, the Echo was a resounding success.
It has sold 5 million devices by the time Google introduced its first smart speaker in 2016. Apple, which has never made much progress in the field of smart home, presented its first HomePod in 2018.
“We didn’t think about the smart home from day one, but we quickly learned from customers that they wanted to use their voice for more than entertainment,” Koopmans said.
Lighting was the first, Amazon adding Alexa activation to one of the first smart light bulbs, the Hue.
It is made by Philips, where Koopmans was chief marketing officer before joining Amazon to run the smart home operation three years ago.
“Three hundred million devices are connected to Alexa today.
That’s 200 million less than a few years ago. And the growth is fast,” Koopmans said.
number of products
The number of products compatible with Alexa began to skyrocket after the opening of its voice activation platform to external developers in 2015.
Last year, the U.S. smart home market was worth nearly $113 billion, up 20% from 2020, according to data company IDC.
Amazon shipped 11.5% of smart home devices to the United States in 2021, an increase of 15.5% compared to the previous year.
Runner-up Google shipped 6.5% and Samsung came third with 5.8%.
More than 77% of Wi-Fi-connected households in the United States owned at least one smart home device in 2021.
Amazon’s Ring Video Doorbell 4 is shown at Amazon’s smart home lab in Seattle, Washington, on September 9, 2022.
Wright says his house is filled with 185 Alexa-enabled devices. IDC surveys have revealed that 60% of users with a smart speaker end up buying an additional smart home device. Still, Wright is not entirely optimistic.
iRobot and privacy issues
Before the smart home event in September, CNBC visited Amazon’s smart home lab in Seattle, where more than 45 connected devices were on display.
“There is a smart refrigerator that is connected to Alexa. We have our thermostat, our doorbell and our Ring cameras, the vacuum cleaner, the indoor air quality monitor, the television,” Koopma said.