• by Wendy Davis  @wendyndavis, January 31, 2024

The Federal Trade Commission on Wednesday cheered news that Amazon had abandoned its attempt to purchase iRobot Corporation -- parent company of automatic vacuum cleaner Roomba.

“We are pleased that Amazon and iRobot have abandoned their proposed transaction,” FTC associate director for merger analysis Nathan Soderstrom stated Wednesday.

He added that the FTC's investigation of the proposed merger “revealed significant concerns about the transaction’s potential competitive effects.”

Amazon and iRobot terminated their merger agreement this week due to concerns by European regulators.

In the U.S., watchdogs had urged the FTC to block the merger, arguing it threatened privacy and competition.

“There is no more private space than the home. Yet with this acquisition, Amazon stands to gain access to extremely intimate facts about our most private spaces that are not available through other means, or to other competitors,” more than two dozen organizations -- including Public Citizen, Electronic Frontier Foundation, Center on Privacy & Technology at Georgetown Law -- say in a 2022 letter to the FTC.

Those groups argued the merger would boost Amazon's position in the internet-of-things market, arguing Amazon already dominates the “smart home device market” through Alexa and other products. The watchdogs added that Amazon could potentially sell Roombas at a loss (or near loss) to Prime subscribers, which would then enable the company to harness more consumer data.

The FTC is currently prosecuting two separate cases against Amazon. In one case, the FTC alleges Amazon monopolizes the online “superstore” market, and in the other the FTC claims Amazon dupes consumers into signing up for Prime subscriptions and thwarting cancelation attempts. Amazon denies the allegations and is contesting both matters.