Google Inc (GOOG) Acquires Nest, but Why?

At this point, the news is out: Google Inc (NASDAQ:GOOG) has acquired Nest. While it was only natural for this company to be acquired, there were some big surprises along the way. For example, does it really make sense for the search engine giant to pay at least $3.2 billion for the company?

As we go back in the past, it is easy to see that Google has been wanting to get a piece of this market for quite some time. Remember Android Home back in 2011? This was the company’s first attempt to enter the smart home space, however, it flopped in no time at all.

This time around it appears that Google Inc (NASDAQ:GOOG) is taking a different route. They are getting involved directly, ensuring that they have control over every last detail.

We all know that Nest is a young company. We also know that they are off to a good start in the smart home market. Not only does Nest have the right technology in place, but with Google at the helm it will be much easier to speed up development and hopefully push new products to the market.

Google Inc (NASDAQ:GOOG)

Google Inc (NASDAQ:GOOG), Third Party Developers, and Ads

We all know that Google is not against working with third party developers. Now that it has acquired Nest, this is something to keep an eye out for in the near future. Is it possible that Nest could be opened up to developers? This may not be something that we begin to see in 2014, but over the next couple of years it is an option that could definitely come to light.

ABI Research brought another interesting point to light, noting that there could be an advertising play in this for Google. For example, they could use Nest as a means of monitoring user activity. While there is a lot of gray area here, especially with all the privacy concerns, don’t be a bit surprise if it is not something that we hear more about as the two companies begin to merge their cultures.

While 2014 is still young, this is one of the biggest acquisitions of the year. Google Inc (NASDAQ:GOOG) wasted no time making the first big move of the year, and now it is time to sit back and see what the company decides to do next.

Will this end up being a great purchase for Google or a multi-billion dollar flop?


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