iRobot, the Massachusetts-based pioneer that invented the Roomba and defined the consumer robotics market, has filed for Chapter 11 bankruptcy. But the tragedy doesn’t end there. In a final, desperate bid to keep the lights on, this once-iconic American company is being sold to its main supplier: a Chinese firm based in Shenzhen.
For those of us who have been watching the Federal Trade Commission’s (FTC) ideological drift under Chair Lina Khan, this news is heartbreaking, but it is not surprising. In fact, it is the direct, inevitable result of a “neo-Brandeisian” antitrust crusade that prioritized attacking American success over preserving our competitiveness. A crusade that has unfortunately gone global.
Less than two years ago, iRobot had a lifeline. Amazon, an American success story with the capital and logistics to revitalize the struggling robot maker, agreed to acquire the company. It was a textbook example of how acquisitions can save distressed firms, preserve jobs and drive R&D.
Unfortunately, Lina Khan’s FTC helped European regulators block the acquisition and celebrated the EU’s decision to block the merger. They argued Amazon might favor its own vacuums or could use map data to hurt competition years down the road. At the time, NetChoice argued that blocking this deal wouldn’t protect competition; it would destroy a competitor. We warned that hobbling an American innovator would only clear the field for state-backed Chinese rivals who face no such regulatory handcuffs.
By blocking the acquisition, regulators doomed iRobot’s future. Deprived of the resources it needed to compete with Chinese competition, the company was forced to lay off nearly half its workforce, kill innovation projects and finally, capitulate to China. Khan celebrated the deal’s demise as a key accomplishment at the end of her tenure as FTC chair.
The irony is bitter. Under President Biden, Chair Khan’s FTC spent years worrying that an American company might dominate the smart home market. Thanks to their intervention, that market is now being ceded to Chinese interests. The intellectual property, the engineering talent and the brand equity built over decades in the U.S. will now answer to Shenzhen, not Boston.
This debacle must serve as the tombstone for the Biden-era antitrust experiment. For too long, the FTC has operated as a central planner, trying to socially engineer markets rather than policing actual anticompetitive conduct. The “neo-Brandeisian” movement has treated American business size as a crime, ignoring the global reality that our companies are competing against state-sponsored giants abroad.
When regulators prioritize academic theories over market realities, American workers lose their jobs, and American technology is sold for parts to our geopolitical rivals. We must reject this approach, and antitrust policy should move back to the consumer welfare standard.
As the new administration closes out its first year, the lesson is clear. American antitrust enforcement must return to its core mission: protecting consumers and unleashing free markets. We need regulators who view successful American companies as national assets to be cultivated, not enemies to be destroyed.
Progressive antitrust efforts in the West successfully “protected” iRobot from Amazon and handed it to China. Now, there is no iRobot left to protect. Let this be the last time American innovation is sacrificed by big government planners.
Image via Unsplash.