The race for smart home supremacy has been escalating rapidly and Google has reabsorbed smart home appliance maker Nest, which has been working for three years now as a fellow Alphabet Inc. subsidiary.
The reunion between these companies has been rumored since November, in order to expand Google’s home hardware team. However, it has been confirmed that Marwan Fawaz, like HTC engineers on Android, will now join Google’s hardware division and report to hardware chief Rick Osterloh, who’s responsible for the development team and efforts on Google Home, Pixel smartphones, and Chromecast.
— Reuters Top News (@Reuters) February 7, 2018
Nest merger means Google is gearing up to take on Amazon
Osterloh revealed that Google’s plan consists in the development of AI-powered hardware that will allow Google products to employ machine learning and functioning as a single unit of home appliances to assist users. The division head’s argument was that the most logical evolutionary step is to make brand products complement each other in their functions.
The involvement of Nest will be a clear advantage and it will boost their market value. As this acquisition will benefit both companies, it seems like corporate giants have been taking over more laidback companies, setting them as perks on the race to the top. However, industry leaders seem to be gearing up more and more with other companies as associated partners.
Meanwhile, Apple will release the HomePod Speaker with Siri on command, and the current market leader is Amazon presenting Alexa as the brains of its ecosystem and the standard Amazon Echo as the top-selling smart speaker this holiday season.
Without a doubt, Amazon’s simplicity has proven to be their strong end, with accessible Echo devices for everyone’s enjoyment and assistance. Amazon is taking over the marketplace, and this has pushed Google to find a competitive angle. In this case, their development towards a strong leverage will be introducing AI in every piece of hardware in the Google catalog, and now Nest properly enters the home appliance battle.
I hope this merger is partially about the death of Nest's product philosophy. Google aims to make products for everyone, while Nest wanted to be the "Apple of smart homes," with prohibitively expensive hardware and crazy monthly fees. It was very "not Googley."
— Ron Amadeo (@RonAmadeo) February 7, 2018
Alphabet and Nest have a back-and-forth history
Alphabet’s creation was made through a corporate restructuring by Google. The specialties and working areas of the giant have been technology, life sciences, and research, but despite its many subsidiaries like autonomous car developers Waymo, and healthcare unit Verily, everything has been masterminded by Google, who now calls upon the services of Nest.
Nest, however, was first acquired by Google for $3.2 billion and it was co-founded by Apple engineer and iPod architect Tony Fadell. The company has proven to be specialized in smart products, and they have managed to sell millions of products around the world.
Among their successful smart product repertoire, we can find a smart thermostat, the Nest Cam security cameras, and the Nest secure home system. These are probably the products that drew Google’s attention to the workforce recruitment for the development of their new home appliance lineup.