Google Purchases NEST- $3.2 billion

[wooohooo]

http://www.theverge.com/2014/1/13/53...or-3-2-billion

Google has just purchased Nest Labs, the maker of the Nest Learning Thermostat and Protect smoke detector, for $3.2 billion in cash

[You Need a Thneed]

That's a lot of money for a company with two products, one of which has only been out for a month or two.

[Regular_John]

This is easily the first time since the Nest thermostat was first introduce that I'm happy not to have one in the house. Google has enough of my data, and this time there's just not enough of a trade off in service to justify them knowing my wake/sleep/in/out schedule.

[wooohooo]

Yah I'm feeling that google is trying to integrate more with home things...

Have a little robot thingy waking you up like in Iron man. Tell it to make coffee, it brews something, tells you what you wanna know. Kinda cool, but kinda freaky too.

[Rathji]

If it means I can get an ad supported version for $50...

[MrMastodonFarm]

Originally Posted by jaydorn

This is easily the first time since the Nest thermostat was first introduce that I'm happy not to have one in the house. Google has enough of my data, and this time there's just not enough of a trade off in service to justify them knowing my wake/sleep/in/out schedule.

ha ha ha, oh you, they already know all that.

[Wormius]

Originally Posted by You Need a Thneed

That's a lot of money for a company with two products, one of which has only been out for a month or two.

They have essentially bought, for a lot of money, "coolized" versions of otherwise ordinary household objects. Is NEST really profitable at all? It still seems like early adopter sales.

But, I somehow think they're moving forward with "Internet of Things" push. Could be interesting to see where some of it leads.

[rd_aaron]

I don't believe the NEST products themselves will make back the $3.2 billion. I'm assuming Google bought NEST for the adaptive technology that they could maybe implement in other products, and to take a foothold in the smart home/home automation industry.

[Regular_John]

Originally Posted by rd_aaron

I don't believe the NEST products themselves will make back the $3.2 billion. I'm assuming Google bought NEST for the adaptive technology that they could maybe implement in other products, and to take a foothold in the smart home/home automation industry.

The number I saw yesterday was that google paid about $3,000 for each installed thermostat. Obviously that's just straight division and doesn't include things like staff or R&D, but yeah, they've got a bit of a hill to climb in recovering that ROI.

[Rathji]

Without any real research, I am guessing that The patents, software and related development is really what they paid for. Direct Nest sales or related income is almost not relevant compared to what they can do in the future with it.

I wouldn't be surprised if part of it ended up being used with self-driving cars.

[Azure]

Estimates have NEST making $300 million per year already. That number should climb pretty good. Look at it as a ten year investment. Most people that have NEST stuff love it.

In terms of direct revenue it is a much smarter purchase financially than the Motorola purchase was.

Of course, people tend to think black and white when it comes to purchasing companies like this. The Motorola purchase has allowed Google to write off a lot of tax expenses because Motorola operates at a loss. Significant savings.

The NEST purchase involves a lot of patents and software development like Rathji mentioned that would take years for the Google team to develop.

Extremely smart purchase, and just more diversification going on at Google. I know everyone likes to think they don't want to hand over more personal information to Google, but the NEST thermostat, even with the personal data being given to NEST, is a game changer.

[Mazrim]

Does Nest have a large amount of patents under their belt for their products? It could be similar to when Google bought Motorola, and everyone was saying it was mainly for the patent portfolio. (That being said...Motorola has done some great stuff since being brought under the Google umbrella, so it ended up being more than that.)

EDIT: Doh. This post was sitting for a while before I hit submit, and Rathji and Azure already covered exactly what I was thinking!

[mykalberta]

I was looking at purchasing a NEST thermostat for our home durring Christmas as I saw them on sale for $200.

I did some reading.

Nest is currently under attack by Honeywell for patent infringement. They have some pattents but recently paid a patent troll for access to their patents to protect themselves from Honeywell.

The NEST brand is a very strong technology brand, Im a bit surprised Google would out right purchase them and not say 80% so that it doesnt get the negative press of owning them.

I am sure there is some clause for the creative team behind NEST to stay with Google for at least a few years.

[Meelapo]

I'm sure Google is thinking about the integration their applications can have with Nest. For example...

Before I leave work I fire up Google Now (or Google Maps) and check the traffic home. Google knows this and knows how long it will take to get home and will adjust the thermostat to ensure by the time I get home the house is heated/cooled to a specific temperature.

Something like that sounds pretty neat!

[Russic]

I love my Nest and I don't quite know what to think. I feel the Protect (smoke detector) is a great step in an interesting direction, and the money should let them expand into other areas. I think Google spent way too much money for this to just be a project to tinker with or to just grab talent.

I was worried when Google bought Waze (crowd-sourced navigation app), but my fears seem to be unwarranted as I see Waze data is often baked into Google Maps.

[smoothpops]

I just can't seem to wrap my head around the sheer amount of info that google/nest can acquire about us from each device. That alone could be worth the billions paid. This seems to be the where future of tech is headed; great functioning tech that integrates incredibly well into our lives while silently gathering massive amounts of data on us.

[MrMastodonFarm]

Google has started selling the Nest through their online store, Google Play. Available in Canada as well.

[DownInFlames]

Originally Posted by MrMastodonFarm

Google has started selling the Nest through their online store, Google Play. Available in Canada as well.

It's still cheaper to buy it from Apple or Amazon since they don't charge for shipping.