Amazon’s bid to acquire leading robot vacuum cleaner maker iRobot has failed under EU regulatory pressure, forcing the Roomba maker to make major cuts to its R&D spending and workforce. And that could have major consequences for home robotics in the future.
The proposed $1.7 billion acquisition was first announced in August 2022, but in November 2023 the European Commission made public its objections to the deal in a press release who warned that the move “could limit competition in the robot vacuum cleaner market”.
Well, those objections have now killed the Amazon and iRobot acquisitions issue a joint statement who expresses their disappointment in no uncertain terms. Amazon in particular is furious with EU regulators, saying that “inappropriate and disproportionate regulatory hurdles discourage entrepreneurs” and “harm both consumers and competition.”
While iRobot’s rivals in the race for the best robot vacuum may disagree, the knock-on effects for the Roomba maker appear significant. In a separate editioniRobot explained how it plans to survive as a standalone company, including cutting R&D spending by $20 million per year and cutting more than 30% of its workforce.
The company also plans to pause “all work related to non-floor maintenance innovations, including air purification, robotic lawnmowers and education.” Of course, Amazon says that “this outcome will deny consumers faster innovation and more competitive pricing, which we know would have made their lives easier and more enjoyable.”
While it’s too early to say definitively how exactly this acquisition collapse will impact iRobot and Amazon’s smart home plans, early signs are that it could certainly limit iRobot’s ambitions in the near term – especially outside of nuclear robot vacuum army.
Analysis: Where Does iRobot Go Next?
If you own a robot vacuum cleaner like the iRobot Roomba Combo J7 Plus – the current top pick in our best robot vacuum cleaner guide – this acquisition collapse has no real impact in the short term. Barring a fairly major restructuring, iRobot will continue without Amazon, saying it will “continue to build thoughtful robots and intelligent home innovations.”
But the bigger question, and bigger unknown, is how this might affect robot vacuums and home robotics in the future. iRobot has been making robo-vacuum cleaners such as the Roomba series for over 20 years, starting in 2002. Since then, the range has grown significantly and branched out into gutter cleaners and robo-mops.
This acquisition may see Roombas further integrated with Alexa AI and become part of a broader range of robotic home devices, something Amazon has been pursuing with the likes of Amazon Astro. We’ll never know now, but reactions to the news among tech fans will likely be mixed.
While some may have been looking forward to the robot fruits that a partnership between Amazon and iRobot has produced, others may be relieved that the Roomba maker won’t be giving up its significant home mapping data to the tech giant.
For now, it looks like iRobot will scale back its ambitions outside the robot vacuum sector that made it such a tech star, but iRobot’s former CEO Colin Angle – who stepped down after the deal’s collapse after 33 years – is optimistic. about his future.
In a LinkedIn post revealing that he will remain a “senior advisor” to iRobot, Angle said that “the consumer robot industry is on the cusp of innovation and growth” and that “iRobot has an exciting future ahead.” We’ll have to wait and see if the latter turns out to be the case, but the robo-vacuum world in general has certainly changed today.