Amazon proposed buying iRobot in a billion-dollar acquisition deal last August, and it looks like U.K.’s antitrust regulators are on board with the idea. The proposal has been accepted in the UK by the Competition and Markets Authority (CMA) as of today, but will still need to undergo regulatory review.
“It’s important to ensure tech firms that already benefit from powerful positions aren’t able to use those positions to undermine competitors at the expense of UK consumers and businesses,” said Colin Raftery, Senior Director of Mergers at the CMA. “After a thorough investigation, we’re satisfied that the deal would have no impact on competition in the UK.”
Amazon was cleared by the CMA to buy iRobot for $1.7 billion, the company behind Roomba, one of the leading robot vacuum brands.
The CMA takes a number of factors into consideration before approval, including collecting data and internal documents from companies considering merging to better understand how partnerships will affect competitors. The CMA looked at rival robot vacuum companies as well as smart home platforms.
The CMA found that Amazon’s proposal wouldn’t severely impact the market position of rival vacuum cleaners, stating “the loss of potential competition from Amazon wouldn’t have a substantial impact on market outcomes.”
There had been concerns that Amazon could use its online retail position to the disadvantage of other robot vacuum companies however, the CMA found little incentive for Amazon to undermine competitors. Part of the CMA’s views on this is that the UK market for such devices is small and isn’t expected to grow much in upcoming years.
The CMA also concluded that Amazon’s rival smart home platforms would also not be outmatched as robot vacuums are not significant in a growing smart home market in the UK.
“Most people are choosing to use ‘smart’ tech in their homes – whether that’s listening to the radio through a smart speaker, answering the door using video doorbell, or keeping floors clean with robot vacuum cleaners,” said Colin Raftery. The CMA has found a number of competitor robot vacuums that might provide more competition for smart home services.
The European Commission will make a final decision by July 6th. The U.S. Federal Trade Commission is still conducting an investigation of the proposal. Check back with Cord Cutters News as more details are released.