In the immortal words of Yoda, "begun the Clone War has." While it has not yet come to war, and actually doesn't even involve clones, several major tech firms are starting to seriously get in on robotics. Google (NASDAQ: GOOG ) seems to have recognized the importance of this type of technology, and has embarked on an acquisition spree over the last few months. This follows the news of Amazon's (NASDAQ: AMZN ) plans to deploy drones for delivery purposes. Now that Google has purchased its eighth robot engineering company, many commentators and investors are beginning to wonder what exactly the company plans to do with this technology.
Rock into the future
Many people have mixed feelings about the prospect of robots playing a big part in our lives. Some estimate that up to 45% of America's jobs could be automated in the near future, for example. Also, there are the fears of annihilation at the hands of robots, probably reinforced by works of science fiction such as The Matrix.
Indeed, anxiety surrounding Google's latest robotic acquisition may not be entirely unfounded. The Massachusetts engineering company has multi-million dollar defense contracts with the US army for the development of advanced robots capable of traversing a variety of terrains. While Google has stated it will honor these existing defense contracts, it says it does not intend to expand into this area, presumably in keep with its principle of not being evil.
The project falls under Google's "moonshot" expeditions, a term it has given to projects that have a long shot at succeeding. The moonshot division is now headed by Andy Rubin, who was formerly responsible for the incredible success story surrounding Google's Android operating system, which began as a rather obscure venture and ended up being one of the most-used pieces of software in the world. According to Mr. Ruben, "the future is looking awesome!'
Publicly traded robotics company, and maker of the well-known Roomba, iRobot (NASDAQ: IRBT ) , rallied in sympathy following the news. Like Boston Dynamics, iRobot does work for the US army. However, its main strength is currently in supplying consumers. Having recently caught an upgrade from JP Morgan, the stock was up over 20% on the news of Google's acquisition. Clearly, Google's interest in robots has investors excited as to the industry's prospects.
The opinions as to what Google plans to do with these robotic acquisitions are very much divided. Many analysts believe that Google's recent purchases have something to do with its plans to create autonomous automobiles, a project which the company has been mulling over for some time. Another theory is that the company is gearing up for the time when advertising revenues will dry up, and it is looking for other avenues for growth.
Google isn't the only tech giant looking to get in on the future potential of robotics. Amazon's Jeff Bezos has made it very clear that he intends to roll out a drone delivery system within the next five years. The service, which is to be called Amazon Prime Air, has already started tests. However, the FAA has yet to approve drones for civilian use in the United States. In other robotic acquisition news, Amazon picked up Kiva Systems recently for around $775 million, which will help it automate its fulfillment centers.
The bottom line
The future looks bright for robotics companies. Google recent announced the acquisition of Boston Dynamics, the details of which are so far undisclosed. Exactly what Google plans to do with its eight robotics companies is not yet clear, but the Internet giant clearly plans to get in on the trend before the competition starts heating up. Amazon has also expressed its interest in robotics. We certainly live in interesting times.
More compelling ideas from the Motley Fool
They said it couldn’t be done. But David Gardner has proved them wrong time, and time, and time again with stock returns like 926%, 2,239%, and 4,371%. In fact, just recently one of his favorite stocks became a 100-bagger. And he’s ready to do it again. You can uncover his scientific approach to crushing the market and his carefully chosen 6 picks for ultimate growth instantly, because he’s making this premium report free for you today. Click here now for access.