Amazon expands reach into the home with Eero acquisition

Amazon is acquiring Eero for an undisclosed sum. (Eero)

Amazon’s entry into homes and businesses is widening. The company announced that it will acquire Eero, a popular maker of mesh Wi-Fi equipment that was founded four years ago.

Terms of the transaction were not disclosed, but the San Francisco-based company has raised $90 million in venture capital since it was founded in February 2015. The company sells two primary products: a hub that acts as a tri-band router and a beacon that expands the coverage area of a mesh Wi-Fi network.

The move by Amazon is widely viewed as an effort to expand its reach and capabilities it provides to customers.

“Amazon realizes that one of the hindrances to the advance of the smart home is the quality of service related to Wi-Fi issues. Well-integrated mesh networking technology makes every Echo device a potential hotspot, increasing Wi-Fi range, lower latency and higher speeds,” Patrick Moorhead, founder and principal analyst at Moor Insights & Strategy, wrote in response to questions.

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Amazon’s foray into the mesh Wi-Fi market could also advance the relatively nascent technology and circumvent wireless carriers’ strategies for in-home network expansions, according to Moorhead. “While mesh Wi-Fi technology is getting very popular inside homes, it’s not pervasive. I see Amazon ‘democratizing’ the tech by offering it to more homes,” he wrote. “Unfortunately, most carrier in-home smart home installs do not support mesh Wi-Fi networks, opting for a brute force approach.”

In a prepared statement, Dave Limp, SVP of Amazon devices and services, said Amazon and Eero have a “shared vision that the smart home experience can get even easier, and we’re committed to continue innovating on behalf of customers.”

While Amazon’s acquisition of Eero is a consolidation to some extent, Moorhead says the Wi-Fi market is more competitive than ever with multiple startups targeting mesh networking as a differentiator. However, Amazon’s strength in the home with smart devices makes it a formidable player in the space.

“I can imagine Amazon integrating mesh networking into higher-end Echo devices like Show, larger speakers and even subwoofers, turning each of these into an integrated repeater,” Moorhead wrote. “Overall, that could equate to better quality of service with lower latency and higher speeds throughout the house.”

Amazon did not disclose a timeline for the acquisition to be completed but said it is subject to customary closing conditions.