Amid growing reports of unrest at Nest, new information has leaked about the companies foray into the home security sector. It is not exactly a secret that Google’s $3.2 billion dollar acquisition intended to release security related products.
On the contrary, the only surprise has been how long it has taken for the company to bring products to market. With a backdrop of a not-so-happy corporate atmosphere, many are suggesting the firm’s internal struggles are to blame for its less than spectacular record since its acquisition.
While corporations are generally quite good at keeping internal troubles under wraps, the problems at Nest were spilled to the world when Reed Albergotti (a reporter at The Information and the co-author of the famous book on Lance Armstrong’s doping scandal), got Nest under-fire CEO Tony Fadell, Nest co-founder Matt Rogers, and former Dropcam CEO Greg Duffy to talk openly about their problems with each other. The latter, Duffy, whose company ‘Dropcam’ was acquired by Nest for $535 million in 2014, didn’t hold back, calling Fadell a “tyrant” and said he was embarrassed by Nest’s handling of his former company.
Back in November, co-founder Rogers, said he was “losing sleep” over an exodus of approximately 70 employees in about six to 12 months. Fadell responded by pointing out that of those who left had come from either Google, or from Dropcam. He went on to urge employees who have a problem with the way Nest is run to step up, rather than take on a “victim mentality”. Victims are “not long for the world”, he added.
In the now long running back-and-forth, Duffy claimed that "the 50 Dropcam employees who resigned did so because they felt their ability to build great products being totally crushed". He also challenged Fadell to publish Nest's accounts to reveal how well its rebranded ‘Nestcam’ cameras were faring compared to its smart thermostats and net-connected smoke alarms.
Sales of the firm’s camera device have performed relatively well, according to several sources, but its other two products, their flagship smart thermostat and their smoke detector, have been stagnant for sometime. In the search for new revenue sources, all signs pointed toward security. While consumers have been slow to adopt smart lightbulbs, doorbells and refrigerators, people do pay when it comes to security.
According to The Information, Nest’s series of security products, will include a product with the codename “Flintstone”, which will be a wireless hub and the central brain behind the whole setup. Flintstone works with Thread, a wireless standard that Nest created specially for home communication, which is expected to relay information back and forth between other smart home products.
The Thread standard may be the major technical hurdle to the delayed product releases. The standard has come under increasing scrutiny, many even calling into question its label of “standard”, as the company have struggled to make it as compatible as they might like. Nest would likely argue in defence of Thread, but with Flintstone three years in the making and with its release date still uncertain, they might not have much of a case, at least until they have something to show.
It could be suggested that The Information’s report places too much weight on Nest’s hardware products, disregard the multitude of firms who have built integration for the ‘Works with Nest’ platform and the relative success of that platform. However, for a company built around selling hardware, there is no getting away from the distinct lack of new hardware.
The same report suggested that Google had become impatient with Fadell and his staff’s failure to create a home security product, in part because Fadell’s on-going hesitation on whether or not Nest should include a central hub device that would control sensors and other products in the home. “Mr. Fadell has changed his mind several times about whether to introduce a hub at all and how that hub should be designed”, current and former employees say.
The lack of a Nest security series is underlined by the fact that Dropcam was planning to release ‘Dropcam Tabs’ in August of 2014 just before Nest acquired them. They were security tabs that could be placed on windows, doors, or fences around a house, which would send notifications on your mobile devices if those entry points were opened. For the system, which seemed to be creating excitement in the market, Dropcam Pro cameras would be used as a hub. With the acquisition, Nest killed Dropcam Tabs as they were “already working on their own similar solution”. Yet, nearly two years later, we still haven’t seen anything of the sort.
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Nest’s Dropcam Tabs-like product, we’re led to believe, is called “Pinna” and are made up of wireless security sensors. You’d imagine Pinna would use Thread to communicate; therefore the issues with Thread implementation may be causing the delay. Then again, the problems may all come back to the indecision over "Flintstone", which should tie all these devices together.
There is also another unreleased Nest product, “Keshi”, which we are led to believe, are Bluetooth tags that could be attached to your key-ring or bag or tossed in a purse, that automate some of your Nest system. Sources suggest locking or unlocking doors, activating or deactivating your Nest security system on and off, or perhaps turning lights on or off, as you leave or come home. Seemingly another good product idea we are yet to see for whatever reason.
Perhaps this clash of egos spilling into the public domain has made pundits overly critical of a company just two year after an acquisition and major overhaul. However, the fact is that Fadell will continue to be under pressure until Nest, under his command, produces real results. Looking wider, the lack of results could have serious implications for the smart home sector as a whole. While Nest may not be living up to its promise, the same could be said of the Apple HomeKit and others, which draws the entire smart home sector into question, and all amid a tightening funding environment in Silicon Valley.