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Amazon is reportedly expanding its hardware division to work on smart home devices

Last week, Amazon released seven new hardware products at the same time, a surprise for a company which often seems like it treats its hardware division as a novelty. But Amazon is serious about hardware, and the commerce giant is currently developing new products including connected gadgets for the home as well as wearable technology, according to a new report in Reuters.

Amazon’s hardware unit, Lab126, which is based in California, is hiring more engineers to develop these new products. According to Reuters, which is citing California government documents pertaining to a $1.2 million tax break, Lab126 had nearly 3,000 full-time employees in 2013 and is looking to expand to at least 3,757 full-time staff at the office by 2019.

What will these extra people work on? One product mentioned in the report is a “simple Wi-Fi device” that will be able to order household goods with the press of a button, which sounds a lot like an improved stationary version of Amazon Dash. One of the Reuters sources said that Lab126 is “interested in” wearable devices, which could be head-mounted — think Firefly visual search on a pair of Amazon-made Google Glass — or could be an Amazon entry into smartwatches. As with all unannounced products, either could be killed before it makes it to market.

Lab216 was responsible for the Fire Phone, which doesn’t appear to be doing well, but that shouldn’t dampen Amazon’s enthusiasm for smart home hardware. Amazon is in a great position to take advantage of the internet of things. Its habit of selling hardware at slim margins is a great strategy to get sensors into people’s homes. Its position in cloud services means it already has the much of the infrastructure to collect and organize a massive amount of data from household sensors. Plus, its commerce business gives Amazon a clear path to making money from that data.

We’ll be talking about the connected world and how giants like Amazon will fit into it at our Structure Connect conference in October, which will feature speakers from Google, Jawbone, and Facebook as well as other companies.

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