When Google announced yesterday its $3.2 billion cash purchase of Nest, the jokes flew. “If your house is burning down you’ll now get gmail ads for fire extinguishers,” Valleywag’s Sam Biddle tweeted.
But no one who has watched Google struggle with the hardware business in recent years could really believe it would just be shelling out for thermostats and smoke detectors, no matter how smart Nest’s reinventions of those devices might be. Though Google says Nest will retain its own identity as a company, the partnership’s potential sets up some seriously great expectations of an entire world populated with Google-powered smart devices.
“Both companies believe in letting the technology do the hard work behind the scenes so that people can get on with their lives,” Nest CEO Tony Fadell told WIRED in an interview just after the deal was announced.
“Our roadmap furthered letting tech do the hard work,” he said. “(Google) said, can you do this more quickly?”
Nest’s first product was a smart thermostat.
Nest’s first product was a smart thermostat that adjusts to your living patterns.
And for Google, speed is essential. The key lesson from the just-ended Consumer Electronics Show in Las Vegas is that serious innovation in core gadget lines like smartphones and televisions is coming to an end (see bendable screens as Exhibit A).
Google itself has never managed to make a mark in either category.
Not only that, its much heftier $12.9 billion purchase of Motorola Mobility has mostly served as a strong drag on its bottom line.
Instead, the excitement at the show was around wearables and the so-called internet of things. The future of hardware isn’t better versions of the same standalone tech. It’s what you can create when you take all the smarts of the smartphone and build them into everything else.
As its own early dive into wearables with Google Glass demonstrates, Google knows it can’t miss this next big leap in hardware, which would end up costing the company much more than $3 billion in lost opportunities.
Here’s what Google gets for its money:
A Product Master Who Beat Apple to the Next Big Thing
Before co-founding Nest, CEO Tony Fadell was best known for designing the iPod, an impressive enough feat on its own. But Fadell reportedly charmed the impossible-to-please Steve Jobs with a bit of conference room showmanship that ensured his place in Apple lore.
“Faddell went to the table, grabbed all the parts he’d shown earlier, and began snapping them together like a LEGO model,” Leander Kahney recounts in his biography of Apple’s chief designer, Jony Ive. “He handed the electronic sandwich to Jobs.” And so began the upending of both the tech and entertainment industries.
Buying Nest doesn’t bring Ive to Google. But Fadell might be an even better catch. Fadell is an engineer with demonstrated mastery over all aspects of the hardware process, with a high-design sensibility to boot. From supply chain and components to fit and finish, Fadell has shown he can manage a product for a company with Apple’s global reach.