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Google Acquires Home Automation Company, Nest Labs, Inc. for $3.2 Billion… But Why?


google + nest


Yesterday, January 13, 2014, marked the first day of the second full workweek of the new year. While the rest of us were patting ourselves on the back for having made it through the first, the Acquisitions Team at Google was celebrating a different, slightly more significant accomplishment — its $3.2 billion offer to purchase home automation company, Nest Labs, Inc. Co-founded by Tony Fadell, “one of the fathers of the iPod,” (source: CNET), Nest has found success with its smart Nest Learning Thermostats and smoke/carbon monoxide (CO) detectors, Nest Protect.

There is speculation that Google, facing doubts about the future success of Google Glass and having missed out on the peak of the innovation period in smartphones and smart TVs, is turning its focus to the so-called Internet of Things and the evolving concept of the connected home. Considering how strongly last week’s Consumer Electronics Show (CES) focused on wearable technology and The Connected Future, the timing, and even the monetary amount — Nest was valued at just $2 billion earlier this month — of Google’s offer is not surprising.

So why did Google acquire Nest?

1.With Google having essential abandoned public discussion of its Android @Home project, perhaps this acquisition — which closed earlier today — will breathe life into this seemingly dead initiative. Said Google CEO, Larry Page, on the day of the offer, “[Nest] is already delivering amazing products you can buy right now… [and we] are excited to bring great experiences to more homes in more countries and fulfill their dreams!” The results and implications of this acquisition will certainly be followed closely by tech blogs, websites, and publications in the weeks to come, and it will be interesting to see what innovative concepts, products, and technologies come from Google’s new possession of robotic and smart/automation companies and their technologies and capabilities.

2. Google may be moving to support the heavy investment it made into gesture recognition technology, computer vision, and robotics companies at the end of 2013. Headed by former Android CEO Andy Rubin, Google acquired eight robotics-focused companies (Flutter, Schaft. inc, Industrial Perception, Redwood Robotics, Meka Robotics, Holomni, Bot & Dolly, and Boston Dynamics) between October and December 2013. This sudden, rapid spree was likely intended to enhance a number of the companies Google X projects, such as the Google Driverless Car, the previously-mentioned Android @Home, Project Loon, and rumored robotic avatars. As a “cryptorobotics” company, specializing in machine sending, automation, and control, Nest’s focus bears little — if any– resemblance to the humanoid android technology of sci-fi movies. The level of sophistication it has achieved in its products, however, may easily be applied to projects with dissimilar aims, raising questions of Google’s  intended use of Nest’s smart technology.

3. By retaining the current Nest team, who have conceptualized and developed the company’s current product and the technologies that power them, Google has acquired a new set of employees who will be able to fill a current void in the company’s technology development sector. Wrote Fadell, who is now a member of the Google team, “Google will help us fully realize our vision of the conscious home and allow us to change the world faster than we ever could if we continued to go it alone,” wrote Fadell in a blog post yesterday. “We’ve had great momentum, but this is a rocket ship.”

What do you think of the acquisition? Was it worth the money? What current projects will Google use this technology to enhance, and what new projects and products will Nest employees’  knowledge and abilities enable Google to pursue? Please comment with your thoughts, and continue to check the Overdrive blog for future posts documenting the unfolding story that results from this recent acquisition.


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