Valued at $3.2 billion, Nest has a catalog of smart home products such as a Learning Thermostat, which can track the movements and activity of people in their homes.
“Nest is all about home automation,” said Clayburn Griffin, search engine optimization strategist at 360i. “It offers ‘smart devices’ that control things in your home and are connected to the Internet so you can get alerts and adjust settings from any device anywhere in the world,” he said.
Combined with the information Google has obtained about its consumers based on email and search patterns, as well as GPS navigational tools on their smartphones, privacy advocates say Google may now have the power to know more about its users than many thought was possible.
For example, by combining the data both companies obtain, Google will likely now be able to decipher if a person lives alone or with others, what time they go to bed, when they wake up in the morning, how often they open the refrigerator, and even how often and how long a person watches porn.
Once Google masters a person’s daily behavior, personality traits and determines if he or she has any mental disorders, such as depression, obsessive-compulsive behavior, impulse control problems or an addictive personality, Google can create an eerily accurate profile of each consumer and market specific products and services to them.
“Google wants to know as much as possible about people so they can better target them with advertising,” Griffin said. “Microsoft is already in everyone’s homes through their Kinect system,” he added, “and Google is looking for their own way in.”
Nest co-founder and CEO Tony Fadell, a former executive at Apple who is credited with creating the iPod, told CNN that “Most companies have two paths: They either can stay independent, or they can join forces with another company and get absorbed into it.”
When asked why they chose to partner with Google over Apple or Microsoft, Fadell didn’t say much more than “Google made a very strong pitch for how we could have all the resources of a large company while retaining the independence of a next-generation Nest.”
But in a blog post on the company’s website, Fadell wrote that “Google has been in the mix in some way or another for about three years of our almost four-year history,” and said “I know that joining Google will be an easy transition because we’re partnering with a company that gets what we do and who we are at Nest –and wants us to stay that way.”
Too much power
Though Google’s motto is literally “don’t be evil,” the announcement of the company’s acquisition of Nest has been riddled with concerns from members of the public who say Google already knows more personal information than the public realizes, and that the merger of the two companies will produce more accurate depictions of what people do, think and feel.
While Griffin doesn’t think there are any short-term privacy concerns, since Nest’s privacy policy only allows customer data to be used to improve Nest products and services, he says now that the company is owned by Google that could all change, and pointed to YouTube as an example.
“It took a few years, but now your YouTube account is your Google+ account, and Google integrated your data on YouTube (what you were viewing, what you were searching) with their other services in an effort to show you more targeted ads,” he said.
“They’ll do the same with Nest and future Nest products. Google will work toward filling your home with self-learning devices connected to the Internet and streaming private data straight to them. And advertisers will be able to target you based on the data your home is sending to Google.”
He added that long-term plans for Nest likely include Google being able to take readings of items commonly found in a home such as a thermostat, refrigerator and lighting, and tie it to a user’s Google account so it can send targeted ads based on things like temperature and whether you’re running low on milk.
Rob Enderle is the president of the technology researcher firm the Enderle Group. In an interview with MarketWatch, he said it was only a matter of time before Google or some other tech giant bought Nest, before adding that Google’s ownership of Nest is particularly concerning since the company appears to be irrespective of consumers privacy.
“I kind of think Google read ‘Big Brother’ and took it as a career goal,” Enderle said, adding that “Given Google’s hunger for information, future products would have far more sensors, cameras and other technologies that cold (sic) eventually create privacy concerns.”
Aware of the concerns circulating around the Internet, Nest released a statement on its website saying “Our privacy policy clearly limits the use of customer information to providing and improving Nest’s products and services. We’ve always taken privacy seriously and this will not change.”
Whether that was comforting and convincing response for the public remains to be seen.
Public response
It’s estimated that currently some 115 million households in the U.S. have Nest products such as the thermostat or the carbon dioxide monitor, and according to Griffin, the bulk of them will have no issue that their personal information and habits are being monitored for advertising purposes.
“The public will be fine with giving their data to Nest/Google,” he said. “Most people likely won’t even realize it. We accept terms of use without reading them and rarely consider what information we’re giving to companies and what they may be doing with it.
“There will surely be a bit of vocal outcry from privacy advocates, but the majority is happy to give away personal data if it means they get affordable or free products and services in exchange. With Nest, you may be revealing your daily routine to a company but you’re lowering your energy use and freeing yourself from worrying about setting and changing your thermostat. That’s a fair trade for most people.”
While Griffin says he doesn’t own a Nest thermostat himself, his mom does.
“She doesn’t know much about it but says ‘it’s awesome.’”
But as technology and wireless connections to the web are increasingly incorporated into products, such as personal appliances and televisions, privacy concerns may only increase.
Griffin pointed out that Google has already purchased several robotics companies, including Nest, and is working with auto companies to create “smart cars” that come equipped with its Android operating system.
Why is Google doing all of this? According to Griffin, Google wants two things: “The first is as much data about you as possible to support its ad targeting. The second is to make your life as easy and carefree as possible so you spend more time browsing the Web where you’ll view ads served by Google.”