Amazon face first UK hurdle in attempt to hoover-up iRobot
We’ve got some good news – and we hope it is just the beginning.
We told you back in November that we were fighting against Amazon’s latest attempt to grow its colossal ecosystem even bigger – this time via the planned $1.7bn purchase of robot hoover maker, iRobot.
We penned submissions to some of the key global competition regulators – who hold the power to block these deals from happening.
And it seems we have been listened to. Last week the UK competition regulator, the Competition and Markets Authority (CMA), announced they are beginning a formal investigation into the deal, following in the footsteps of scrutiny ongoing in the US.
A formal CMA investigation means Amazon will face tough questions about the impact of the deal. Third parties will also get to share their views on how they think yet another Amazon acquisition will impact the markets.
We are pleased the CMA has committed to scrutinising this deal – but we’re not popping champagne corks just yet.
The launch of this investigation only means we have taken the first step on the long road to getting this deal blocked. The CMA will take a few months to scope out the key issues before deciding whether to investigate it further in a longer ‘Phase II’ process – something that can take years.
So, why on earth are we bothering? Is there a weird Foxglove fascination with robot hoovers?
Not quite. But we do have an unerring passion for fighting dangerous tech monopolies. We’ve spoken before about how monopoly lies at the centre of the toxic nest of harms caused by Big Tech. Challenging monopoly power aims for its heart – delivering a blow that could have a cascading impact in reducing the myriad harms these companies cause – to democracy, workers and to competitors, as well as to you and I.
Our ultimate goal is clear – we want to see Big Tech behemoths like Amazon broken up – split into various smaller pieces that would deliver real competition. Smaller pieces that would not have the overwhelming power which allows them to treat their workers like trash.
Until we reach that goal, at a bare minimum we must fight tooth and nail to prevent these Big Tech powerhouse ecosystems swelling even bigger. And that is what we are doing with the Amazon/iRobot deal.
We know exactly what Amazon are up to with this deal because they have done it so many times before.
Remember Zappos? Quidsi? Soap.com? Probably not. That’s because they all fell victim to the never-satiated Amazon beast that bought them up.
The Bezos strategy is to spy out competitors and swallow them – regardless of whether the goal is to neutralise a threat or buy up a superior offering while quietly shelving the struggling Amazon version.
iRobot is just the latest example. Too lazy to invest in the failing Amazon ‘Astro’ robotic hoover, Amazon are simply buying up iRobot and the hugely popular flagship ‘Roomba’ product.
That is a problem even before we even consider the consumer data collecting capabilities that come with iRobot products.
But being able to know the layout of your home, as well as hear and see it through Alexa and Ring, is the real goldmine Uncle Jeff is willing to part with $1.7bn to get his grubby mitts on.
It’s not just Amazon that have followed the ‘sniff out and snuff out’ playbook. Competition regulators waived through disastrous deals like Facebook buying WhatsApp and Instagram. They gave the green light for Google to buy FitBit. So, despite welcome clamp-downs like the refusal to allow Meta to purchase Giphy, we cannot trust they will not once again allow these giants to grow.
That is why Foxglove will stay in close contact with the CMA throughout this investigation – to remind them that this investigation should not just be about expensive robot hoovers.
Our message to the CMA boils down to one simple question – should we allow an already overwhelmingly powerful corporate ecosystem to grow by swallowing up yet another competitor?
The answer is no.
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