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Homes to Become ‘Smarter’ with Google’s Acquisition of Nest (Here’s How)

gutterman, sara, green mediaIn case you had any ambiguity about the future of the smart home, Google’s recent decision to purchase Nest for $3.2 billion in cash has sealed its fate. It’s official—our homes represent the new frontier for all things digital.

Nest, the maker of sophisticated, user friendly, stylish household devices such as thermostats and smoke detectors, has, of late, been the darling tech company that experts love to reference when making the case that consumer electronics have evolved beyond phones and tablets. With innovation opportunities for core gadget lines like phones and TVs reaching a plateau, investment is now pouring into intelligent, connected devices that will power all aspects of our lives.

It’s predicted that Nest’s products will revolutionize the connected home space in the same way that Apple transformed the smartphone category. Nest Founder and CEO Tony Fadell says that it’s not just the sleek design that excites people about the company’s products—it’s also the back end technology that helps homeowners gain insight into how their houses are performing.

For the first time, people can use monitoring systems like Nest’s to measure and assess the way that they use energy in their homes. And, even better, these intelligent devices autonomously modify their settings, learning a homeowner’s preferences and optimizing for comfort and efficiency.

Fadell isn’t stopping with thermostats and smoke detectors—his plan is to create the ‘conscious home’, in which all of today’s mundane devices are transformed into smart and pleasing interfaces. His ultimate goal is to help people become smarter about the way they live in their homes. For Nest, it’s not just about turning up or down the heat, it’s about helping homeowners learn from the experiences that come with turning up or down the heat, and then to make better decisions about energy use, environmental impact, health, and safety.

Mirroring Tesla’s conquests in the automotive industry, Nest is giving the large manufacturers a run for their money, primarily due to the company’s radically different approach. As Fadell states, “We don’t just see a thermostat with a better user interface; we see a smartphone that has thermostat functions. That is a very different thing. We don’t see a smoke alarm; we see a smartphone with a fire sensor. When you redefine the world that way, it opens it up to many more possibilities.”

For Nest and its competitors, selling connected devices to homeowners is only part of the goal. The Holy Grail is actually the metadata, which is collected every time a homeowner flips a smart switch, presses a connected button, or interacts in some other way with the growing amount of sensors embedded in the proliferating number of smart home devices.

Google didn’t pay $3.2 billion just for a well designed thermostat. It’s the prospect of accessing homeowners’ metadata, which profiles the way we live in our homes, that makes Google salivate.

The real value to Nest and Google is in understanding our patterns, preferences, and schedules. In essence, we are the product that the two companies can monetize. Google already knows our behavior when we’re in front of a PC or mobile device. With the acquisition of Nest, Google has now colonized our homes.

While Google and Nest both firmly assert their commitment to user privacy, critics are concerned. And the whole scenario begs a valid question—who, ultimately, owns the right to know about our interests and behaviors?

Privacy concerns aside, let’s think about the future—the opportunities are as exciting as they are boundless. These intelligent, connected devices are revolutionizing the building industry, and they will inevitably change the way we live.

It’s even anticipated that these devices will be able to read our minds: researchers at Michigan State University are developing a single electrode device that can be placed on the scalp to read electrical activity from the brain through a technology called electroencephalography, or EEG.

Soon, our homes will know if we’re unhappy, sick, or grumpy and will be able to adjust temperature, lighting, security, and other mood settings correspondingly. With that much possibility for future connectivity, it’s no wonder why Google wants to grab a piece of the pie now.

What do you think Google’s acquisition of Nest means for our future?

We at Green Builder Media are fascinated by the Internet of Things and are excited by its widespread applications. Tell me what you know about the IoT. Write to me at sara@greenbuildermag.com or follow me on Twitter @SaraGBM

Sara is the Co-Founder and CEO of Green Builder Media. An experienced entrepreneur, investor, and sustainability consultant, Sara specializes in developing companies that are simultaneously sustainable and profitable. Sara is a former venture capitalist and has participated in a portion of the life cycle (from funding to exit) of over 20 companies. Sara graduated Cum Laude from Dartmouth College and holds an MBA in entrepreneurship and finance from the University of Colorado. This article was reprinted with permission from Green Builder Media.

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