Google Swoops Down and Snatches Nest Labs in $3.2 Billion Connected Home Play

Google's ongoing efforts to infiltrate your homes with different types of digital gadgets continues with the acquisition of Nest Labs, a maker of modern day digital thermostats and smoke alarms. Not for the faint of wallet, Google agreed to pay $3.2 billion cash for Nest Labs, which was founded by Tony Fadell, the former Apple senior vice president who worked with Apple co-founder Steve Jobs in helping to design the iPhone.

"Nest’s founders, Tony Fadell and Matt Rogers, have built a tremendous team that we are excited to welcome into the Google family," Google CEO Larry Page said in a statement. "They’re already delivering amazing products you can buy right now--thermostats that save energy and smoke/CO alarms that can help keep your family safe. We are excited to bring great experiences to more homes in more countries and fulfill their dreams!"

Nest Thermostat

Make no mistake, this acquisition isn't simply about getting into the thermostat market. There's a much bigger picture Google is attempting to paint, one that centers around the so-called "Internet of Things," which is the idea of connecting everyday objects, especially those that aren't known for having Internet connectivity. On an even larger scale, it's a step towards home automation.

"The Nest acquisition by Google is yet another validation point that the Internet of Things (IOT) sector has graduated far beyond its startup phase. Google has made an art out of deeply understanding how people interact with their virtual world, the web, and in so doing has been able to monetize that understanding in wildly successful ways. This acquisition is the first of what we see as potentially many next steps by Google and others to further understand the vast amounts of data representing how people interact with their physical world," Gilad Meiri, IoT expert and CEO of Neura, told HotHardware in an emailed statement.

Indeed there's a world of opportunity awaiting companies like Google. With this acquisition in particular, it will be interesting to where see Google goes, whether it chases deeper integration into the home energy management space or branches out in different directions to facilitate connected homes.