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Amazon Advances Into Home Security With $1 Billion Ring Acquisition

Amazon has acquired smart doorbell manufacturer Ring, giving the e-Commerce giant a greater presence in home security, connected home devices and in-home delivery. The deal is worth $1 billion, according to Reuters.

In October 2017, Amazon unveiled its Amazon Key in-home delivery service, whichcombined the Amazon Cloud Cam with smart lock technology to provide couriers with unattended access to Amazon Prime members’ homes. The entire delivery is recorded on the camera and is designed to address the challenge of package theft, but the launch of the service predictably drew criticism for its general concept and potential security loopholes.

The Ring acquisition likely is designed to strengthen this system, especially as Amazon slowly rolls out its own delivery service. Ring makes WiFi-enabled doorbells equipped with cameras designed to detect when someone is at the door. Through an app, the smart doorbell rings users’ tablets or smartphones and lets them see audio and video in order to talk to the person at the door from wherever the users are.

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In an interview with Reuters,Wedbush Securities analyst Michael Pachter said he believed security and alarm companies such as ADT could feel the negative affects of Amazon’s security kick. “Camera technology is far superior to physical security…With Amazon having roughly 100 million Prime members, that’s a big addressable market for them to start selling this into.”

Amazon had a previous relationship with Ring, having invested in the company through its Alexa Fund, which exclusively invests in companies that help scale its Alexa voice technology.

Amazon is positioning its Echo smart speaker with the embedded Alexa voice assistant as a home technology hub, already having integrated Ring into the platform in June. Users of the Echo Show device can say, “Alexa, show my front door” to receive a live feed of activity around their home via Ring cameras.

This is the second major home security acquisition in three months for Amazon. The company acquired Blink, a startup that develops battery-powered connected cameras and doorbells, for approximately $90 million.

“Beyond home access, Amazon is assembling a contingent of adjacent technologies that could quickly be combined to create a complete home control system that goes far beyond what Alexa is capable of today,” said Luke Starbuck, VP of Marketing at Linc, in commentary provided to Retail TouchPoints. “With new Echo products featuring cameras, having indoor and outdoor vision of a consumer’s home would give Amazon incredible data on not just shopping habits, but living habits. No doubt this could be parlayed into a far richer understanding of customers, and Amazon will not be shy about leveraging this data to enhance target products and improve offer timing to increase revenue. Though consumers may not instantly recognize it, Amazon is pushing the line further into a territory that could create backlash surrounding privacy.”

Ring has raised more than $400 million, according to PitchBook data. Its most recent outside investment round in October 2017 raised $160 million and valued the company at $760 million.

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