Here's why Amazon's Ring acquisition may be its smartest deal yet

Key Points
  • Amazon is acquiring Ring, a deal that could help Amazon beef up its Key delivery system.
  • It will also help Amazon compete directly with Google's Nest security products.
Amazon buys home security company Ring for reported $1 billion

Amazon is acquiring Ring, best known for its popular smart doorbells. But the biggest benefit to Amazon may be more subtle.

In October, Amazon introduced Key, a system that allows delivery people to drop off packages inside your home through keyless mobile phone technology. The program has faced numerous problems, including the potential to set off a home security system if the customer didn't turn it off manually that day.

Amazon hasn't announced its plans for Ring, so this is pure speculation. But as a Key user who's had his alarm triggered by an Amazon driver, I can envision Ring being used to clear that hurdle while still allowing me to protect my home.

Amazon Key required you to have an Amazon camera placed inside your house, facing the front door. When I tested it, I didn't like having the camera in the middle of my living room. Ring has a built-in camera, so a user may not need a separate camera installed in the house.

Amazon also stands to make additional revenue from the sales of Ring's devices and video plans. On top of Ring's doorbells, which start at $179, the company currently charges $30 per year for video recording on a single camera or $100 for unlimited cameras.

And it also extends Amazon's battle with Google to own the connected home. Google sells a line of Nest security products and has a voice assistant that's taking on the Amazon Echo.

Now watch: Amazon Key review

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