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Amazon has “acqui-hired” robotics startup Covariant for an undisclosed amount, setting the stage for the retail giant to turn its network of fulfillment warehouses into robot-employment epicenters.
The Big Picture: Ecommerce requires a huge headcount to keep the shipping machine running… but companies that figure out how to make actual machines the backbone of the physical labor could order up a lot of cost-savings.
Between the Lines: Amazon’s Covariant acquisition-in-everything-but-name-only could program a new era for the company.
- Covariant has been focused on leveraging AI to train robots how to pick up and handle various physical objects — one of the few skills that has evaded robotics makers because of how many factors are used in grip.
- Covariant’s three founders and several research scientists will now become Amazon employees, and Amazon will license the startup’s models and data… for an undisclosed amount.
- It’s a win for Covariant — which has the tech but has been unable to commercialize it (it needs more money) or level up its algorithm (it needs more data). That’s no longer a problem at Amazon.
Closing Thoughts: Amazon has already partly automated many of its warehouses, thanks to tech from Kiva Systems, but Covariant could provide the final piece to one day make warehouses fully autonomous (with a few human overseers). That’ll surely optimize Amazon’s operations even more than they already are but will likely anger the many flesh-and-blood people who rely on Amazon warehouses for employment, especially during the busy holiday seasons.
Go Deeper: Acqui-hires — hiring a startup’s team and licensing their tech — is quickly becoming the biggest trend in Big Tech to avoid government scrutiny.
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