I don’t know if I was surprised or not when I heard that Google was buying Nest Labs, a maker of connected home thermostats and smoke detectors. Sure, I suppose some believed that Nest Labs would have been a more suitable acquisition target for Apple since the founder, Tony Fadell, was the “father” of the iPod.
But that was then and this is now. Besides, it is reported, unconfirmed of course, that Fadell wasn’t so friendly with Sir Jonathan Ive or the irascible executive fired by Tim Cook in 2012, Scott Forstall. So maybe Fadell was as anxious to get away as he was anxious to earn a boatload of money.
Besides, since the deal with Google is for $3.2 billion, quite an amount for a company not far from the startup stage, he shouldn’t have anything to complain about.
It’s also true that home gear, such as thermostats and smoke detectors, really aren’t Apple’s cup of tea. The company will make acquisitions, but usually for technologies that enhance existing products or new ones. So it’s hard to see where Apple’s move into the home would leave room for products of this sort.
But the connected home — and the connected auto for that matter — appears to be well within Google’s plan to get involved in just about everything that involves some sort of online connectivity.
Indeed, you even have Google building out high-speed broadband in the U.S., at least in a few places, with the promise that the technology will maybe grow beyond the test stage and be deployed in more locales. But what does Google get in return? Just your monthly payment, or are you making yourself vulnerable to the same level of online scrutiny that you encounter with other Google services.
I know that many of you are taking full advantage of Google’s free stuff, particularly search and Gmail. But unless you take steps to opt out of everything you can possibly opt out from, you are Google’s customer. But that’s nothing that should come as a surprise to anyone. So, when you buy a Nest Labs gadget after the takeover is complete, does Google begin to watch your thermostat settings? What about the smoke detector? What about anything that uses Android to manage your well-connected home?
At the recent CES in Las Vegas, Google was on hand to show you how your well-connected car can be managed by Android. Deals have already been struck with Audi and other car makers to incorporate a version of the popular mobile interface in your car.
But how is that reflected in a way that helps Google earn their keep? When you change radio stations on your new car, do you see a targeted ads, or are the stations to which you listen or avoid simply cataloged in some humongous online database, so they understand your habits and can provide some kind of promotional information? What about navigation screens? What does Google earn by taking control of your car’s interface?
With Apple, it’s all about money, and all about licensing fees. Apple may have your credit card number on the iTunes database, but it’s not selling you anything when you use Siri in your car. iOS in the Car may offer various and sundry Apple tools on your car’s LCD display. But, again, it’s not that your motoring habits will necessarily be recorded.
Besides, recent cars from pretty much all the car makers in the U.S. include black boxes that can be consulted in the event of a serious factory defect or an accident. There are already ongoing concerns about your privacy. When you check prices for auto insurance nowadays, most companies will offer you an extra discount, provided you are you’re willing to attach a recording device at least temporarily to monitor your driving behavior.
One expects that your car insurance rate may be impacted if you’re not on your best behavior when the insurance company’s black box is installed. You exceed the speed limit, pass a red light or, perish forbid, are at fault in a fender bender, watch out. You won’t be able to dispute the adjuster, who will simply consult record the data on the black box that you allowed them to install to make a decision on the claim.
When it comes to your home, a Nest Learning Thermostat is designed to monitor your living habits, your schedule, and set temperatures accordingly. The claim is that this gadget “can lower your heating and cooling bills up to 20%.” Maybe, but what will Google be doing with the data recorded by that product in the course of configuring itself? Or will Google be happy to just accept income from a sale? The thermostat is $249, the smoke alarm is $129. The revenue was clearly sufficient to make Nest Labs a lucrative takeover target, but what happens to your privacy if Google wants to store your home heating and cooling profile? Will they sell it to makers of air conditioners or heating systems? What about the power company?
Understand that I have never lived in a home with more than an entry-level thermostat, the kind you buy for $20 or $30 at a Home Depot store. A Nest Labs gadget has never been on my to-do list, and I expect that’s true for most of you. But those who are convinced by the pitch that you can save some money might have been tempted. The question is whether the purchase of Nest Labs by a company that fancies itself as an online “Big Brother” will help or hinder sales. Or maybe it just won’t matter.