Nest shows the importance of planned business models for IoT devices

There’s good news for Nest Cam IQ indoor owners today: The smart cameras now have Google Assistant capabilities built in. The feature is optional — you can enable or disable it — and there’s no additional charge for the functionality. If you choose to enable it, you now have another microphone and speaker for home control, informational queries, setting reminders, and more. I wouldn’t suggest playing music through the small speaker found in the Nest camera though.

Nest also expanded its Nest Aware subscription offering with a new five-day plan costing a dollar per day. That’s perfect for non-subscribers or folks who don’t want to pay for a monthly plan if they’re only going on vacation for a few days. Person Alerts are also new for the suite of webcams, helping to identify a person compared to some other moving object in your Activity Zones. Again, no charge for this new feature.

This news reminds me of a recurring theme that we discuss on the IoT Podcast: When it comes to IoT are you buying hardware, services or both? More often than not, the answer is the latter.

But if you bought a Nest Cam IQ, did you expect new services like Google Assistant or not? If you were promised a future service but never got it for your next IoT device, would you be upset? (You probably would and so would I.) Lastly, if you bought an IoT product and the service offerings were scaled back or changed from free to paid services, how would you feel?

All three of these examples highlight the importance of IoT companies clearly defining and communicating their business models, both internally and externally. If they don’t, they run the risk of quickly upsetting loyal customers or failing to account for their true operational costs.

Making sure the Canary is secure costs quite a bit.

Take the recent case of Canary, for example. Last October, the company removed some of its free service features from customers who bought the hardware with an understanding that they’d have such features, even without a paid service plan.

Night Mode, which captures video from motion detection at night when you’re home and presumably sleeping, went from free to paid. Video recordings were limited to just 10 seconds under the scaled down free plan. And downloading or sharing video clips was eliminated unless you decided to now pay the monthly service fee.

That’s a very different approach from the recent Nest news. Some of it very likely has to do with resources. Since Canary isn’t in the business of running cloud servers for its services, it has to pay for Google Cloud, Amazon Web Services or Microsoft Azure in order to provide these capabilities. Being part of Google, Nest has “in-house” cloud services to use.

But that’s irrelevant to the people buying IoT devices: To them (and me, since I’m a Canary owner), they don’t want to feel like they’re in for a “bait and switch” when purchasing a connected home hub, sensor, webcam, door lock, or what have you. That’s why if you plan to sell any type of connected device with some type of service, you have to plan ahead early in your design process. And if you commit to a level of free services, but later have to change them, existing customers should be grandfathered in, if possible.

I’d argue that Nest has done a better job at this than most. And the Canary example is more of an outlier than the norm, thankfully.

However, I’d bet a month’s worth of my Nest Aware subscription that Nest planned for Google Assistant capabilities when designing the Nest Cam IQ before it launched last May. This way it would make sure that the hardware could handle Assistant queries and be loud enough for responses, while at the same time lining up the necessary software to hook into Google’s cloud for digital assistance.

Besides the hardware and software though, Nest surely did the math on costs for Google’s cloud. Maybe those are free or maybe they’re an internal transfer for the accountants. I suspect it’s the latter, along with analysis of how much of the cloud costs could be recouped through growing hardware sales based on new or additional features.

The point is: If you’re in the IoT device business, service planning may be the most important aspect of your product’s life-cycle. Make sure to do your homework well before the product hits the shelves and begin with the customer in mind.

Stacey on IoT | Internet of Things news and analysis

Google assimilates Nest once more

Saying goodbye must have been too hard for Google as the company is bringing Nest back under its roof.

Nest was co-founded by former Apple engineers in 2010. Google bought the young startup, whose innovative thermostat became one of the first successful smart home devices, for $ 3.2 billion (£2.3bn) back in 2014.

Following a major restructuring — when Google’s umbrella company, Alphabet, was created — Nest was spun off into a separate company. Alphabet is now folding Nest back into Google as the company attempts to fight off increasing competition from Amazon.

Rick Osterloh, Senior Vice President of Hardware at Google, says:

“We're excited to bring the Nest and Google Hardware teams together. The goal is to supercharge Nest’s mission: to create a more thoughtful home, one that takes care of the people inside it and the world around it.

By working together, we’ll continue to combine hardware, software and services to create a home that’s safer, friendlier to the environment, smarter and even helps you save money—built with Google’s artificial intelligence and the Assistant at the core.”

Google sees the IoT and smart homes as a major source of growth in the coming years. The company has put significant resources into building its AI and launching a range of smart home devices.

Amazon’s competitor, the Echo line, has been commercially more successful than Google’s — in part due to the company’s retail influence. However, according to survey-based data from Consumer Intelligence Research Partners (CIRP), it appears Google Home has gained some ground on Amazon’s devices.

The competition is increasing for Google and not just from Amazon. Apple joins the fray, as of today, with its HomePod. Later this year, Microsoft, Samsung and Facebook will also be entering the market.

In advance of their entries, Google is bolstering its in-house manufacturing capabilities. Last week, Alphabet's Google unit announced it had paid $ 1.1bn to buy a large chunk of HTC's hardware operations — gaining the company around 2,000 engineers in Asia.

Do you think bringing Nest back into Google is a good idea? Let us know in the comments. Latest from the homepage

Nest Secure monitoring will cost you, but… will you pay?

If you’re buying into the Nest Secure security system and want professional system monitoring, it’s going to cost you. We knew this when Nest introduced its product in September, but what we didn’t know was the pricing specifics. And now we do.

Customers who choose to have their Nest Secure monitored by MONI’s 7 by 24 service, will pay $ 24.99 a month with a three year commitment. Those who don’t want a three-year contract can do so at a price of $ 34.99 a month. The subscription also includes a cellular backup service for the Nest system; you can pay $ 5 a month for that separately if you don’t want professional monitoring, according to the Nest Secure product page.

These prices are separate from the optional Nest Aware subscription that has been available for some time. Consumers with Nest cameras can pay $ 10 a month (or $ 100 yearly) for the Basic Nest Aware plan, which provides a 10-day video history, intelligent alerts, clips and timelapse videos and the creation of activity zones. For $ 30 monthly (or $ 300 a year) the Extended Nest Aware plan boosts the video history to 30 days.

Part of me is surprised that Nest Secure is priced roughly the same as you’d find from many current and legacy home security providers. With these monitoring cost options, there’s little to differentiate Nest from other home security vendors.

Even as a product, I’m not sure the $ 499 Nest Secure offers a huge difference or step forward from what’s available in competing home security hardware, plus it costs more than comparable systems. The recently introduced Wink Lookout will only set you back $ 199, for example, as does the Ring Protect.

Nest Secure may be a little easier to arm or disarm, and the Nest Tag is certainly convenient. And integrations with Nest’s cameras and thermostats may be compelling. But open/close door sensors, motion detection, audible alarms and keypads are all table stakes today for home security. Add in either a contract or a $ 35 monthly fee for professional services and you could be describing any company in this space.

In fact, you could be describing MONI itself. Although Nest has contracted with MONI to handle the Nest Secure monitoring, MONI itself sells home security systems. And like the traditional security model, it provides the equipment for free but customers pay between $ 39.99 and $ 59.99 a month for the monitoring service. The company is reportedly the second largest home security monitoring company in the US (behind ADT) and also has more than 600 dealers in North America.

It may make sense for Nest to contract out the monitoring aspect of its security product rather than build it from scratch. But I suspect that many Nest Secure customers will simply stick with a lower cost Nest Aware service and rely on smartphone alerts from their Nest Cams and the Nest Guard centralized “brains” of Nest Secure.

Maybe I’ve just been in the DIY (do it yourself) camp for too long though. I’d be curious to hear from readers if they’re interested in the Nest Secure as a product first and also if the professional service is appealing too.


Stacey on IoT | Internet of Things news and analysis

Hitachi’s new IoT play and Nest becomes a security company

Nest Detect is one of the new product announcements from Nest.

On this week’s Internet of Things Podcast, hosts Stacey Higginbotham and Kevin Tofel discuss the big news from Nest. August also updated its line of locks and promised a better doorbell. Meanwhile, rumors of an Amazon Alexa security system or even glasses emerged. And Google leaked some news. They also talk about smart grid M&A and Comcast buying Stringify, a company that links together myriad devices and lets you create scenes. Kevin also shares his thoughts on the Apple Watch with LTE and they answer a reader question about garage doors.

In the interview segment, Stacey interviews Rob Tiffany of Hitachi about the company’s new industrial IoT play. Rob is the CTO and Global Product Manager of Lumada IoT. Why is Hitachi embracing IoT? Learn on this week’s IoT podcast.

Either play below or get on iTunes or your Android device.

Stacey on IoT | Internet of Things news and analysis

Meet Noon: A stealth lighting startup by a former Nest executive

The FCC label shot for the Noon dimmer.

Is the world ready for a new smart lighting company? That’s the bet Erik Charlton, a founding member of the Nest team and its former head of business, is making with his latest startup. Locoroll is a Cupertino-based company making a smart dimmer switch according to filings with the Federal Communications Commission. Based on both the FCC filings and a trademark filing, Locoroll plans to sell the switch under the Noon brand name.

Lux Capital and Sway Ventures have backed Locoroll, which also has an impressive roster of smart home product executives. Greg Smeltzer, its head of product comes from Lyve, a company that made photo organizing software for phones and TVs. The head of marketing is Kathy Sanders who was the former CMO at August. Other members of the team come from GoPro and Fitbit.

I’ve been tracking this startup for the last few months after hearing about it from a retailer. The launch timing is uncertain, but is likely close given that the FCC filing has appeared. However, the product has been a while in the making. Locoroll was formed in Jan. 2016 according to Charlton’s LinkedIn profile.

The original product appears to be a smart dimmer switch, but the company calls itself a smart lighting system. The switch will have both Bluetooth and Wi-Fi support according to the FCC filing. Smart lighting makes sense as a category if only because there are few super compelling options out there. Lutron is my personal favorite but it requires a hub to connect with popular services thanks to its proprietary radio technology.

Other switches offer basic lighting functions plus the ability to control the switch through an app or a voice-based interface like Amazon’s Alexa. And there are dozens of interesting startups that offer capacitive touch buttons that are programmable or artificial intelligence built in that will learn your habits. If I were making a bet, that’s where I would hope Noon goes.

Because light switches have continuous access to power and a relatively large space to put computing, they are a logical place to put Bluetooth-based presence detection in a room: algorithms that anticipate what a person might want at a set time and even repeaters for wireless services. If Noon offers anything like that it would be compelling.

Although it would have to be done well. There are few things more irritating than a “smart” light that incorrectly anticipates your wants. Currently, startups ranging from Nuro Technologies to Brilliant are trying to innovate in lighting. Other companies include KetraStack Lighting, and Plum.

The challenge, however, is that light switches require an install that intimidates most people. If Noon can make installation easier, offer a unique blend of services that feel automatic and make it look stylish it could win in a category that is still trying to figure out what it should look like in a smart home.

Stacey on IoT | Internet of Things news and analysis