Nest labs is a home automation company headquarters in Palo Alto based in California that creates programmable thermostats and smoke detectors etc. The company was founded in 2010 by former Apple engineer Tony Fadell and Matt Rogers. Google has announced the surprised deal earlier this week that he will provide more tool to build a valuable hub for homes. The tech provider Google has bought smart home device maker next lab in $3.6 billion cash which is 28.5 time Nest estimated annual revenue of $120 million. According to me anyone can pay that kind of premium if they think purchase is going to completely transform the world. Let’s assume that why Google actually considers 3.6 billion a meaningful amount of money. Here we are going to discuss about some points that why Nest is a smart buy for Google.
Google make hardware easily with Nest
Google is software & service Provider Company and it done a great job at nurturing third part hardware ecosystems around its software and services. If we take an example of nexus Q then it’s proved that Google doesn’t have a great customer hardware expertise. After buying a next Google give a boost for its hardware section and instead encourage with the idea of tony Fadell and Matt Rogers. The company also buys a Motorola for its hardware section which shows the Google may not be able to design its hardware section without the help best hardware designers.
Nest devices monitors the real world
Recently Google has try to collect data from the real world and been trying expand its knowledge from the virtual world into the real world. For example some time ago Google introduced Google now service which gives information about how much walking you have been doing based. This system is based on GPS collected data. Next designed devices let Google service users to collect information form virtual world into real world. As Next expends its home automation products such as which room you are in, how long you spend there and what you are doing there.
The internet thing is at an early stage
In the consumer electronics show (CES) 2014, in upcoming three years we are going to try to connect everything to everything else. In the present time Smartphone are big examples of this which are reinvented as sensor hubs that collect data, interpret and analyze it. There’s a land grab going on for the best expertise and infrastructure in this new, growing field, and Google wants to have a strong position early.
According to me Google deal for nest is a positive for the smart home industry overall as it will raise awareness for the space, opens up third party development for Nest devices as well as drive faster adoption of smart home technology by mass consumers.