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17 May 2019

Google I/O: Nest brand given a key role in unified smart home platform

Google has finally admitted that its Nest smart home subsidiary has a strong brand that could be better leveraged. So the firm has now announced Google Nest, the new name for what was called Google Home before Nest, and its smart thermostats and other devices, was merged into it.

At its I/O developer conference last week, the company showed off the first Google Nest Device, the Hub Max – a home hub with a screen and now a front-facing camera.

The news came as Amazon announced that there are now 60,000 Alexa-compatible devices, from 7,400 unique brands, available on the market – up from 20,000 devices and 3,500 brands just eight months ago. Samsung might also finally launch its Galaxy Home, but the way the Korean firm has handled its Bixby and SmartThings platforms do not bode well for its ability to worry Google and Amazon. Apple might also do something radical with HomeKit, but that looks less likely by the day.

So Google and Amazon continue to be the two main players in the smart home space,  courted by operators looking to increase the stickiness of their offerings via home partnerships, as well as by brands looking to improve the attractiveness of their products as part of these collaborative ecosystems.

However, both platforms have major problems in terms of their messaging and their parents’ positioning. For Google, the rebrand doesn’t do anything to escape the fact that its core business is selling advertising, and that these smart home devices, however anonymized, are a way for it to push more accurately targeted adverts, but not necessarily more welcome ones, at users.

As for Amazon, it wants to sell more products through its gigantic retail channel, and more and more of those products are digital, although there is also an expansion of the grocery business on the back of its acquisition of the Whole Foods chain.

In time, Google would like to have far more reach into its users’ lives, so that it can offer a better ‘Google experience’ to them. In exchange for this service, it gets to promote heavily targeted advertising, which it should be able to charge companies much more for. Having more smart home devices is the first step towards ensnaring users inside a cozy experience that Google can monetize.

At I/O, the web giant was showing off a unified vision of its smart home offering, in which Google Nest is a brand just like Google Pixel. The new $230 Google Nest Hub Max is going to be available in the summer, with new smart speakers also going to carry the new brand. The Hub Max is a rival to Amazon, but also to Facebook – the latter a wild card that has been promoting its Portal device quite heavily, but seems generally unlikely to displace Google or Amazon.

But a larger part of the I/O pageantry was focused on the improvements made to the Google Assistant, the voice platform that is going to power much of a consumer’s interactions with a smart home. The Assistant is key to the overall experience, and so it has to be sticky, trapping consumers sufficiently so that next time they flirt with Siri or Alexa, they are revulsed by their comparative simplicity or character flaws.

As such, Assistant has to be industry-leading in its capabilities, and not just well connected to devices. This is the ‘ambient computing’ that Google’s VP Product Rishi Chandra has talked about – the third big shift in computing, following the shifts to the web, and then to mobile.

Chandra’s vision of ambient computing concerns creating a unified and cohesive consumer platform, which has required a rethink of product design – to ensure that a new device acts as part of this whole, rather than as an island. The three main challenges here are designing for the system, personal identification within the home for personalized experiences, and third, do a better job of communicating its principles around privacy.

That third point is going to be most difficult, especially as Google goes about converting pure Nest environments to Google ones. Of course, this is a process that should have started when the company was first bought, for $3.2bn in 2014. Any home with a Nest thermostat or a Dropcam or Nest camera is now a full Google home, giving the globe’s largest advertising firm a window into users’ worlds, despite Google’s promises that it won’t be tapping into that data.