Google’s Buyout of Nest Raises Privacy Concerns

Google’s announcement that it’s buying Nest Labs for the amount of $3.2 billion has raised a number of concerns, particularly regarding privacy within one’s own home. Described as the ‘next generation thermostat’, the Nest Thermostat claims to reduce a household’s heating and cooling bills by up to 20%, and it does this by learning the schedule of the household and adjusting accordingly. It can also be controlled from a phone. Many consumers are concerned that unhindered access to Nest Thermostats will allow Google to gather even more information about internet users, to use or share to its own advantage. Co-founder of Nest, Matt Rogers has assured consumers that the company’s privacy policy limits the use of customer information to improving the products and services of Nest, going on to say that this policy will not change and Nest will remain an independent brand.

Nest was one of the more than 200 companies that have been assisted by Google Ventures, and the purchase by Google has paid high dividends to venture capital firms. Deals like this one are what keep venture capitalists investing despite the fact that a significant number of startups fail. In addition to funds, Google Ventures provides startups with support in marketing, design, recruiting and other essential requirements. Google Venture workshops provide practical training and one-on-one service. Google Ventures invests in a range of sectors including health care, transport, alternative energy, technology development and more.

While it’s clear that the buyout offers huge financial benefits to Nest, there is much speculation as to what Google gets out of the deal. The most obvious, and for some the most worrying, is that by entering the market of home appliances Google will have access to more data, irrespective of assurances from Matt Rogers to the contrary. Another advantage for Google is that the designer of Apple’s iPod and co-founder of Nest Labs, Tony Fadell, will remain with the company. Also, up to thirty percent of Nest’s employees formerly worked at Apple, and diversifying will help the company boost its growth.

As we move into an era where the so-called “Internet of Everything” will increasingly remotely control many items in our homes, offices and outdoor areas, some caution regarding privacy policies is not amiss. But like it or not, the world is moving toward connecting our lives to the internet, and companies at the forefront of the technology facilitating this are sure to reap some significant rewards.