Google Nest, formerly branded Google Home, is a line of smart home products including smart speakers, smart displays, streaming devices, thermostats, smoke detectors, routers and security systems including smart doorbells, cameras and smart locks. The Nest brand name was originally owned by Nest Labs, co-founded by former Apple engineers Tony Fadell and Matt Rogers in 2010. Its flagship product, which was the company's first offering, is the Nest Learning Thermostat, introduced in 2011. The product is programmable, self-learning, sensor-driven, and Wi-Fi-enabled: features that are often found in other Nest products. It was followed by the Nest Protect smoke and carbon monoxide detectors in October 2013. After its acquisition of Dropcam in 2014, the company introduced its Nest Cam branding of security cameras beginning in June 2015. The company quickly expanded to more than 130 employees by the end of 2012. Google acquired Nest Labs for US$3.2 billion in January 2014, when the company employed 280. As of late 2015, Nest employs more than 1,100 and added a primary engineering center in Seattle. After Google reorganized itself under the holding company Alphabet Inc., Nest operated independently of Google from 2015 to 2018. However, in 2018, Nest was merged into Google's home-devices unit led by Rishi Chandra, effectively ceasing to exist as a separate business. In July 2018, it was announced that all Google Home electronics products will henceforth be marketed under the brand Google Nest.
History
Nest Labs before acquisition by Google Nest Labs was founded in 2010 by former Apple engineers Tony Fadell and Matt Rogers. The idea came when Fadell was building a vacation home and found all of the available thermostats on the market to be inadequate, motivated to bring something better on the market. Early investors in Nest Labs included Shasta Ventures and Kleiner Perkins.
Acquisition by Google of Nest Labs, Dropcam, and Revolv On January 13, 2014, Google announced plans to acquire Nest Labs for $3.2 billion in cash. Google completed the acquisition the next day, on January 14, 2014. The company would operate independently from Google's other businesses. In June 2014, it was announced that Nest would buy camera startup Dropcam for $555 million. With the purchase, Dropcam became integrated with other Nest products; if the Protect alarm is triggered, the Dropcam can automatically start recording, and the Thermostat can use Dropcam to sense for motion. In September 2014, the Nest Thermostat and Nest Protect (a smoke alarm) became available in Belgium, France, Ireland, and the Netherlands. Initially, they were sold in approximately 400 stores across Europe, with another 150 stores to be added by the end of the year. In June 2015, the new Nest Cam, replacing the Dropcam, was announced, together with the second generation of the Nest Protect; there were internal reports that sales of the rebranded camera fell. On October 24, 2014, Nest both acquired the hub service Revolv, and discontinued its product line, gaining the expertise of Revolv's staff.
Nest as a subsidiary of Alphabet Inc. In August 2015, Google announced that it would restructure its operations under a new parent company, Alphabet Inc., with Nest being separated from Google as a subsidiary of the new holding company. In January 2016, some Nest thermostats stopped working, a fault attributed to a software update from two weeks earlier. There were no lawsuits, individual or class-action, due to an arbitration clause in the contract. All Revolv smart hubs, costing several hundred dollars, were deliberately remotely bricked on May 15, 2016; notice was posted on the company's website in February. The story became news on April 4. The "lifetime subscription" to Revolv's online service, which had been sold with the hub, was defined by Nest to be the lifetime of the device, which ended May 15. Nest's decision to brick the hubs, and its "acerbic" corporate culture, faced substantial criticism from within Google/Alphabet and in press coverage. Many of Nest's staffers came from Dropcam and Revolv, and by November 2015, about 70 of about 1000 staffers had quit, causing management concern. Some countermeasures had been taken in takeover deals, to financially discourage senior people from leaving before set dates. Of the ~100 Dropcam staffers, about half had left by March 2016, when former Dropcam CEO Greg Duffy (who left 8 months after the takeover) wrote a post openly regretting selling his company to Nest. He stated that about 500 people had left (of a 1200-person staff). On June 6, 2016, Tony Fadell, the Nest CEO, announced in a blog post that he was leaving the company he founded with Matt Rogers and stepping into an "advisory" role. At this point the Nest acquisition was described by some press as a "disaster" for Google. As of mid-June 2016, Nest's problems were considered symptomatic of the limited market for home automation. According to Frank Gillet of Forrester Research, only 6% of American households possessed internet-connected devices such as appliances, home-monitoring systems, speakers, or lighting. He also predicted this percentage would grow to only 15% by 2021. Furthermore, 72% of respondents in a 2016 British survey conducted by Pricewaterhouse Coopers did not foresee adopting smart-home technology over the next two to five years.
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