What does Ring mean for Amazon?
Through a special arrangement, presented here for discussion is a summary of a current article from the IMS Results Count blog.
Amazon.com in late February acquired Ring, a maker of internet-connected doorbells and cameras, for about $1.1 billion.
Ring is best known for its Wi-Fi enabled doorbells that are equipped with cameras to detect when someone is at the door. Users receive an alert and then are able to view and talk to the individual outside their door through their smartphone.
On the surface, Ring is a powerful acquisition, which launches Amazon further into the home security space. Last year it began selling Amazon Cloud Cam, an indoor security camera of its own design. In December it acquired Blink, a maker of inexpensive internet security cameras and doorbells. Amazon also moves further into the IoT space with more popular products that can connect to Alexa. Google’s Nest also offers a home security system.
The apps and Ring subscriptions will create recurring revenue. All well and good in itself, but several reports on the acquisition focused on how Ring’s technology may build on Amazon Key, a service launched last October that allows Prime members to have orders delivered inside their homes to help deter theft and prevent fresh food from spoiling.
Amazon (and most every e-commerce player) needs a more comprehensive solution for secure home delivery. Beyond opening doors, Ring can be programmed to open a door to a locker.
You can bet that this strategy has crossed Jeff Bezos’ mind — when Ring gets established via Prime, Amazon can charge all of the grocers, pharmacies and retailers to use the Ring ecosystem as the way to make, document and secure deliveries to your door and all the way to your pantry or locker.
The rest of retail needs to take note: Ring is much like Amazon’s cloud. Not only will it generate revenue in itself, it has the power to offer incredible value to end customers. On top of that, Ring can become a powerful portal for secure delivery, ultimately enabling Amazon to charge all players a “toll” for secure delivery. Paying a billion for Ring sounds like a steal for creating another cog in Amazon’s ecosystem.
- Winning the race to the home requires more than the last mile – IMS Results Count
- Amazon buys startup Ring in $1 billion deal to run your home security – Reuters
- Amazon Buys Ring, Maker of Smart Home Products – The New York Times
- Amazon to begin making in-home deliveries in 37 cities – RetailWire
DISCUSSION QUESTIONS: What do you think was behind Amazon’s acquisition of Ring? Does it make sense that Amazon’s ambition is to support home delivery of packages well beyond its own?