Amazon’s hardware alarms privacy skeptics, but won’t slow adoption

• Amazon announced a series of security-focused devices at its annual hardware event.
• Although several of the devices were met with skepticism about privacy, it will not change the adoption trajectory.
• Insider Intelligence publishes hundreds of insights, charts, and forecasts about the technology and connectivity industry with the Technology and Connectivity Report. You can learn more about how to subscribe here.

Amazon held its annual fall hardware event last week, and one of the central themes was smart home security. For example, Amazon introduced the Ring Always Home Cam, a $ 250 standalone drone camera that flies around a user’s home if their Ring security system is activated.

It also announced a $ 200 Ring-brand car camera that monitors vehicle theft attempts and notifies the user of any unusual behavior. To address user data transfer concerns, Amazon said it would soon give Ring users the option to enable end-to-end encryption for video.

Several of Amazon’s ads were met with skepticism regarding their potential to compromise user privacy. As Business Insider and The Verge noted, Amazon’s hardware announcements met with a strong reaction online. For example, Box CEO Aaron Levie wrote on Twitter: “If 2020 wasn’t dystopian enough for you already, Amazon just announced an indoor flying drone camera.”

Similarly, privacy advocacy group Big Brother Watch mocked the drone as “possibly Amazon’s scariest surveillance product yet.” Noted tech journalist Walt Mossberg added: “In a country without laws regulating digital privacy, anyone who buys this from a company with a history of privacy problems is crazy.”

Ring is no stranger to scrutiny over its handling of user privacy. In late 2019, for example, hackers uploaded a series of videos reprimanding and threatening Ring users in their homes. The images included verbal attacks on children, racist comments and threats of violence.

Ring has also come under scrutiny for its relationship with law enforcement: Ring allows its users to share “disturbing” images captured on video doorbells with police departments. Several critics, including the ACLU and the Electronic Frontiers Foundation, believe this system risks reinforcing systemic racism by magnifying the consequences of hasty judgments about the “criminality” of an individual’s appearance.

However, we do not believe that these concerns will change the consumer adoption trajectory of Amazon’s smart home products. More than 1 in 4 consumers in six major markets – the US, France, Canada, Australia, the UK and Japan – refuse to buy a smart device for security reasons, according to a 2019 joint survey by Consumers International e Internet Society.

However, Amazon is likely not targeting this group of consumers with Ring updates, knowing that their concerns about smart home privacy will not be easily addressed with new products or privacy features. Instead, as with the car gadget, Amazon is likely to try to get consumers already in the smart home ecosystem to expand into new domains. For example, of US smart speaker owners, 44% owned only one device, according to a June 2019 survey by Business Insider Intelligence and Attest.

Amazon is pursuing a vision where customers can access Alexa from anywhere, and that will involve rapidly expanding the number of smart devices within the single-user environment, as can be achieved through the products announced last week.

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