Seeking Alpha

Google buying digital thermostat/smoke alarm maker Nest for $3.2B

  • Google (GOOG) is acquiring Nest Labs, a maker of intelligent thermostats and smoke alarms, for $3.2B in cash.
  • Nest, founded by former Apple exec Tony Fadell (sometimes called the godfather of the iPod), has become a darling of the Silicon Valley startup scene by launching innovative, digitally-controlled home products that show an Apple-like design flair (and Apple-like pricing).
  • Nest asserts its mission is to "reinvent unloved but important devices in the home." The startup should provide a major boost to Google's home automation efforts (Android will doubtlessly play an important role in them).
  • Before the acquisition, Nest was reported to be close to raising funding at a $2B+ valuation. Even in the current environment, the deal's price tag is bound to raise some eyebrows.
  • GOOG +0.8% AH.
Comments (25)
  • jgren
    , contributor
    Comments (14) | Send Message
     
    Too bad. I liked Nest products.
    13 Jan, 04:33 PM Reply Like
  • not me
    , contributor
    Comments (44) | Send Message
     
    It could've been worse. Imagine Apple bought it. Then anyone trying to get decent functionality out of Nest products would've had to jailbreak them.
    13 Jan, 04:43 PM Reply Like
  • n403xv
    , contributor
    Comments (36) | Send Message
     
    yea, you will just have to join Google+ to get your thermostat to work.
    13 Jan, 05:07 PM Reply Like
  • not me
    , contributor
    Comments (44) | Send Message
     
    Good point. However I find Google+ much better than Facebook.
    13 Jan, 05:13 PM Reply Like
  • Yesterdays_news
    , contributor
    Comments (1310) | Send Message
     
    Page can have Nest for 3.2 billion dollars. Most people don't consider home thermostats art!

     

    It would have been a lot cheaper to buy a down and out thermostat maker and hire a top rated industrial designer for a few million a year. He shelled out 3.2 billion for a startup company that most people have never even heard of! Why? Because somebody from Apple started it.

     

    I wonder what the shareholders are thinking of their great moon shot leader now?

     

    There are better established cutting edge companies to buy for billions that will return a bigger profit and PR lift - GoPro, Tesla, Stratasys, 3D Systems; etc.
    13 Jan, 09:19 PM Reply Like
  • raincity
    , contributor
    Comments (219) | Send Message
     
    I actually think this was a savvy buy on Google's part. They get a key person behind the iPod in Fadell along with a string of talented former Apple Engineers and Designers. Nest makes awesome products, a buyout was a guarantee.

     

    I don't know about the valuation. Time will tell. Google has been known to overpay for IP.
    14 Jan, 04:05 AM Reply Like
  • DanoX
    , contributor
    Comments (2643) | Send Message
     
    With Apple your info won't be mined, with Apple they sell you a very good product and then they let you get on with it and stay out of the way.
    13 Jan, 04:50 PM Reply Like
  • not me
    , contributor
    Comments (44) | Send Message
     
    How do you know that Apple doesn't mine your data? Do you have the source code of iOS? With Google your product won't be crippled on purpose in order to extract more money from you.
    13 Jan, 05:09 PM Reply Like
  • Tvaddic
    , contributor
    Comments (244) | Send Message
     
    Apple is doing what you accuse Google of doing with iAd.
    13 Jan, 05:21 PM Reply Like
  • DanoX
    , contributor
    Comments (2643) | Send Message
     
    iAd is like Apple Maps, Siri, and Apple search in the future they are designed
    to cut off revenue from Google, Google as a Ad company whose only revenue-
    profit comes from Ads.

     

    Google only purpose is to sell you out, glad I didn't buy a nest.

     

    Maybe this quarter is the quarter Google writes off Motorola for 12.5 to 20 billion dollars.
    13 Jan, 05:44 PM Reply Like
  • Yesterdays_news
    , contributor
    Comments (1310) | Send Message
     
    There are already thermostat smartphone apps. What is Page thinking?

     

    http://bit.ly/1azP2ro
    http://bit.ly/1azP4Qd
    13 Jan, 09:22 PM Reply Like
  • Yesterdays_news
    , contributor
    Comments (1310) | Send Message
     
    No, they hold your data so somebody can hack in and steal it. Just as bad.
    13 Jan, 09:23 PM Reply Like
  • The Deep Value Investor
    , contributor
    Comments (284) | Send Message
     
    Anyone know if Nest would be considered to infringe on any of Vringo's patents mentioned in the litigation against TYCO and ADP? Here is a link from September mentioning the suit against TYCO and ADT, sounds like Nest could fall into the category too, and one know?http://seekingalpha.co...
    13 Jan, 04:52 PM Reply Like
  • DanoX
    , contributor
    Comments (2643) | Send Message
     
    With Google's history in court and with Motorola look out.
    13 Jan, 05:50 PM Reply Like
  • BTM
    , contributor
    Comments (351) | Send Message
     
    Great pick up by Google. They are clearly setting themselves up to be a player in the 'internet of things' future.

     

    Price looks high now but I bet it'll look a lot smarter 3 years from now.
    13 Jan, 06:22 PM Reply Like
  • Yesterdays_news
    , contributor
    Comments (1310) | Send Message
     
    "Price looks high"

     

    Price is INSANE. You could have picked up ALL the companies Apple bought last year and had enough to buy something else.
    13 Jan, 09:26 PM Reply Like
  • BTM
    , contributor
    Comments (351) | Send Message
     
    Apple doesn't make any large business purchases. That's just the way they roll. That doesn't necessarily make this a bad deal for Google. It all will come down to what Google does with Nest.

     

    Everyone thought Facebook overpaid for Instagram right after it was purchased.

     

    Funny, I don't hear that sentiment much anymore.
    13 Jan, 10:14 PM Reply Like
  • jjmc2001
    , contributor
    Comments (1278) | Send Message
     
    I have been thinking about buying the NEST system. This just made my decision for me. NO WAY. It is bad enough they monitor everything I do on the internet. Now they can monitor your home habits. I guess they can lower the temperature and make you want to search for sweaters to buy. The possibilities are endless.
    13 Jan, 06:26 PM Reply Like
  • nguyenvanphuoc
    , contributor
    Comments (377) | Send Message
     
    "I guess they can lower the temperature and make you want to search for sweaters to buy. The possibilities are endless."

     

    This made me LOL.

     

    If MSFT bought Nest they'd do the same thing, but you'd have Clippy popping up when you turned on your computer.

     

    "Hi! It looks like your house is cold! Do you want some help searching for sweaters?"

     

    Or worse yet...

     

    "Hi! It looks like your house is on fire! If you upgrade now, I'll notify the local fire department for you!"
    13 Jan, 07:26 PM Reply Like
  • Yesterdays_news
    , contributor
    Comments (1310) | Send Message
     
    Google does not care about thermostats. From what I have heard they bought this company to compete with Apple's new iBeacon interior wifi broadcaster designs.

     

    Unfortunately, there is only one Jony Ives.
    13 Jan, 09:33 PM Reply Like
  • U2A Ventures
    , contributor
    Comments (159) | Send Message
     
    Never found the Nest stuff to be worth the money. I picked up a Honeywell wifi thermostat at HomeDepot on clearance for $45 about 10 months ago. Works like a charm, apps is simple and easy, never had an issue and I have seen the heat savings this Winter. Even on a schedule, when the temp outside was in the single digits, the system would turn on. With this I can literally shut it off in the morning, off all day, when I start my commute home, I turn it on, by the time I am home its at the perfect temp. Why spend NEST money?!?!!?
    13 Jan, 06:42 PM Reply Like
  • oaksleeksbeans
    , contributor
    Comments (121) | Send Message
     
    Robotic cars, robotic homes, cell phones, tablets... all connected through the internet... developed and tracked by Google. The Google controlled robo-internet world!
    13 Jan, 10:48 PM Reply Like
  • idkmybffjill
    , contributor
    Comments (1625) | Send Message
     
    sounds like skynet.
    14 Jan, 12:47 AM Reply Like
  • Tales From The Future
    , contributor
    Comments (4728) | Send Message
     
    3.2 billion for a company with two (very nice, that much I agree with) networked home products ?

     

    And still everyone on Wall Street is saying we are not in a tech stock bubble...go figure.

     

    My canary is chirping caution (and that's a word play for people who know Canary from Kickstarter).
    14 Jan, 02:55 AM Reply Like
  • idkmybffjill
    , contributor
    Comments (1625) | Send Message
     
    An interesting take on what Google say in Nest:

     

    http://bit.ly/JYTd6b
    14 Jan, 12:50 PM Reply Like
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