Why NEST acquisition raises the bar

Yesterday it was announced that Google is buying NEST by $3.2B.

This is a great win for several areas that so far lacked the validation of a great exit: new-age hardware, energy, connected devices.

The other side of this is that with Google’s distribution and engineering at scale, NEST is now well positioned to dominate the smart home of the future. Tony Fadell, NEST’s CEO hints that clearly on his interview to GIGAOM:

TF: I was spending nearly ninety percent of my time on building the infrastructure of the company and I wasn’t able to spend enough time and cycles on what I love doing: products and creating differentiated experiences for our customers. That is where my love is and Google offered to let us focus on that, but with a scale that will help bring our horizon closer to us, faster. Google offers to bring that scale to us. For me, ultimately building great products is key.

This will help push the Internet of Things Smart Home dreams forward and make the future arrive faster. However, this also means that many mildly-innovative/transition products will have a much smaller opportunity gap.

Today all companies in the Smart Home business should be thinking how they will out-innovate this challenge. And it will be great as they (finally) can’t ignore that innovation & user experience pays off.

Google will probably do more and better consumer hardware in the next few years as highlighted by John Gruber. With the already announced developer program for NEST, this means we may have, in a couple of years, an apple-like platform for connected devices that developers can build upon.

Exciting times ahead for a geek! We are just waiting for our developer account to start hacking this together with some things we have been cooking for the future of unplugg :)