Google learns from previous failures on the ‘smart home’

January 15, 2014 2:35 pm

Google learns from previous failures on the ‘smart home’

By Richard Waters

Nest provides intelligent hardware the tech group needs

To understand why Google has just paid $3.2bn for a company that makes thermostats and smoke detectors, you need only look at some of its earlier attempts to invent the “smart home”.These were more than simply object lessons in what not to do. Past efforts, though resulting in failure, highlight the range of Google’s capabilities – and why, following this week’s acquisition of Nest Labs, it looks to have taken a formidable lead in a new tech market that has barely even been invented yet.

Google’s first attempt, five years ago, took the form of an internet service called PowerMeter. This was an online service for monitoring home energy use. It turned out that most people had better things to do than track their energy consumption on a website.

Next came a software platform known as Android@Home, which was aimed at other manufacturers who wanted to build the “smarts” into internet-connected objects for the home. The first of these products was meant to be an LED lightbulb that could be turned on using a smartphone app. The manufacturer abandoned the idea before it was even launched.

An internet service and a software platform were fine ideas as far as they went: the missing ingredient in all of this was a truly useful piece of intelligent hardware. Or, to be more precise, an appealing, easy-to-use consumer product that bundled together a useful set of capabilities with an intuitive user interface: software, hardware and online service all working in concert to make life around the home better in some way.

So what better person to turn to than Tony Fadell, the man whose claims to fame include being lead inventor of the iPod as well as founder of Nest? Apple’s music player was the gadget that launched the modern consumer hardware revolution: pleasing in itself, it would have been nothing without the software and online store that brought the digital music business to life.

Mr Fadell went on to embed his iPod lessons in Nest’s thermostat, right down to the wheel-like control for programming the unit (though Honeywell has fired off a legal challenge claiming that the circular control unfairly copies one of its own inventions). A Nest thermostat taps into online weather forecasts and information from its sensors about a user’s movements to guess at the best temperature to set.

This is where Google comes in. While it may take a product visionary like Mr Fadell to come up with the idea, the device is nothing on its own. In an interview with the Financial Times, the Nest founder was forthright about what is involved: 80 per cent of the work behind his company’s products goes into building and running the infrastructure on which they depend.

There are few better infrastructures to plug into than the one operated by Google.

It is not just the scale of its data centres or the capacity of its broadband networks: the internet company could also be in a good position to turn the data collected by Nest’s devices into valuable intelligence.

[Google] looks to have taken a formidable lead in a new tech market that has barely even been invented yet

In this, it can bring two assets into play. One is Google’s own vast trove of data. Combining Nest’s data with information from its other services promises to give Google unrivalled insights into your preferences – not just the temperature you like to wake up to, but how long you linger over breakfast before heading to work and what route you take to get there.

The other key asset is the skills needed to make use of all this data, developing the algorithms that turn it into the intelligence that can be used to inform useful services. If Google could anticipate when you were about to leave home in the morning, it could alert you to up-to-the-minute commuting conditions, and make sure your home was properly secured.

Privacy fears are certain to raise their head. But a smart home that truly understands and can responds to your needs might overcome those concerns. And if Google tried to use data from around the home to serve up even more relevant adverts, then that is just part and parcel of the tacit compromise its users have long accepted.

At least, that is the theory. There is still much to do to prove that it can work. Making “smart” household objects desirable will not be easy: customers of Nest’s smoke alarms talk far less enthusiastically about the products than they do about its thermostats.

Google also has to show that it can make serious money as it moves deeper into hardware, where profit margins are lower. But if it can get all the parts of the smart home working together while also coming up with hit new gadgets, it may be hard to match.