Googles announcement yesterday that they are buying Nest for $3.2B was a surprise to me. Not because Nest isn’t a good purchase or doesn’t fit with Google’s offerings. On the contrary – it is a perfect fit from where I sit because Google has always had a two tier cloud offering. One tier is the cloud that Google continues to build out and the other is the endpoint. And despite what everyone is saying about Google entering the home with Nest – Google has been embedded in the home for quite a while and in quite a few ways.
Google has been running on our PCs since before we were ‘mobile’ and has extended onto our mobile devices. Google has had several attempts at our TVs/media centers with GoogleTV and most recently Chromecast. Google has invaded many homes in the central part of the US with their fiber optic-based broadband networks – giving Google access to entertainment consumption as well as allowing them to be the ISP for residential homes, giving them visibility to ALL Internet traffic from people’s homes.
The other moving parts in Google's play for IoT of course include Motorola as a maker of smart devices (come on, think beyond the phone here!) and Android – a platform and marketplace ripe for supporting much more than mobile devices.
Why this all matters to me is it means that with Nest, Google now has a viable brand in the IoT market, a sales and distribution channel with the likes of Home Depot, Lowes, etc. as well as all the goodness of a working platform. Will Nest products evolve and become Android based? Maybe – or maybe not. Nest was smart in that they built a product, a set of services, and a platform that is extensible. All those things are going to be important for a connected home, connected office, or even a connected cow (farm, factory, etc.).
Google brings a lot of goodness to Nest besides just ‘size.’ Google has their analytics engine, cloud for storing the data, plus all those other devices that are either running Chrome or Android on them.
An obvious question is what is Apple going to do? Did they get smitten by the NIH bug? This seemed a no brainer for them. Then there is the one I am really curious about – what will Amazon do? They have so MUCH potential here to be one of the kings of IoT with their cloud services, device expertise, marketplace, distribution network (Amazon.com), and think of all the IoT devices their store owners could link to their cloud – smart lawnmowers, shoes, cooking ware, appliances, etc.
No matter what – thank you Google for starting off 2014 IoT with a bang!