EC Opens Investigation of Amazon’s Planned Acquisition of iRobot

The European Commission (EC) has opened an in-depth investigation into Amazon’s proposed acquisition of iRobot.

The commission has identified initial competition concerns and will now investigate them in greater depth, the EC said in a Thursday (July 6) press release.

“Amazon is both an online marketplace and a retailer,” Margrethe Vestager, executive vice president in charge of competition policy at the EC, said in the release. “We are concerned that, by acquiring iRobot, Amazon may use such dual role to foreclose access by iRobot’s rivals to its marketplace. With our in-depth investigation, we will also investigate whether Amazon would use data collected by iRobot to strengthen its position as online marketplace provider.”

Reached for comment by PYMNTS, an Amazon spokesperson said in an emailed statement that the company continues to work with the EC, aiming to address its questions and concerns.

“iRobot, which faces intense competition from other vacuum cleaner suppliers, offers practical and inventive products,” the spokesperson said. “We believe Amazon can offer a company like iRobot the resources to accelerate innovation and invest in critical features while lowering prices for consumers.”

The EC said in its press release that its preliminary investigation found that Amazon’s online marketplace is an important channel for selling robot vacuum cleaners, that the company may be able to stop or degrade rival manufacturers’ ability to sell on its online marketplace, and that it may prevent its rivals from making their robot vacuum cleaners work with Amazon’s voice assistant Alexa.

The preliminary investigation also raised concerns that Amazon could use data collected from iRobot vacuums and their users to personalize and target its advertising and gain other advantages over its rivals, according to the release.

The EC has until Nov. 15 to assess the proposed transaction and decide whether to block it, the release said.

Amazon announced its plans to purchase iRobot for $1.7 billion in August, noting that the completion of the transaction is subject to customary closing conditions.

The proposed acquisition marked the latest move into consumer robotics for Amazon, which introduced its Astro home robot in September 2021, PYMNTS reported at the time.

The move is also about strengthening and monetizing the cross-activity network effects of the consumers who have connected to more than 300 million smart home devices.