Amazon Expands in Smart Home Space with Eero Acquisition



Amazon acquires Eero

Amazon (AMZN) has announced that it is buying home mesh router Eero amid efforts to expand in the smart home space with its Alexa-enabled devices. Alexa is the technology behind Amazon’s smart speaker Echo devices. Amazon is waiting to get regulatory approval for the Eero deal, the terms and other details of which haven’t been disclosed.

The Eero acquisition could accelerate Amazon’s push into the smart home market, as it has Wi-Fi mesh technology that connects large areas better than the traditional mesh routers. Further, Eero’s integration with Alexa could allow users to control their routers with voice commands.

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Amazon’s expansion in mesh technology

Amazon’s acquisition of start-up company Eero comes after the purchase of similar start-ups like Blink in December 2017 and Ring in 2018, the makers of smart security cameras and doorbell cameras. Earlier, Amazon also invested ~$12.5 million in Luma, another start-up developing Wi-Fi mesh technology.

Like Amazon, Alphabet’s (GOOGL) subsidiary Google invested in the mesh network and launched Google Wi-Fi in 2016, which followed Google’s first router OnHub. On the contrary, Apple reportedly discontinued its product line-up of Airport routers and instead sells the Linksys Velop mesh system.

Amazon’s position in the smart speakers market

Amazon’s Alexa competes with other voice-activated offerings like Apple’s Siri, Alphabet’s Google Assistant, and Microsoft’s (MSFT) Cortana. Samsung (SSNLF) also launched its smart speakers in 2018, thus increasing the competition.

Stiff competition in the smart speakers market has dented Amazon’s dominance, according to eMarketer. According to the report, the market share of Amazon’s Echo devices will drop to 63.3% in 2019 in the US (SPY) smart speaker market, down from 66.6% in 2018.


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