Meet a New Manufacturer Acquirer … and Channel Partner … Google

Yes, it seems strange and you’re saying “Google doesn’t make or sell any electrical products”.  And while you are currently correct, their latest acquisition takes them into a product category that electrical distributors do sell (and which also then technically makes them a manufacturer).  The product category … smoke and CO detectors.

On Monday Google announced that it paid $3.2 billion for Nest Labs, a manufacturer of “smart” thermostats and smoke alarms for homes.

Reportedly this is a play for the “next generation” of smart products (Internet enabled) which is projected to be appliances and door locks.

They sell through Amazon, Best Buy, Home Depot, Lowes, Apple, direct and through certified contractors (most are HVAC contractors).  And the units aren’t cheap.

With the focus being the home, aside from Home Depot and Lowes, the current approach is more DIY and maybe a little remodeling-oriented.  To gain more traction in the new build aspect of the market, Google / Nest will need to approach builders directly and/or utilize some distribution.

But … and here’s where it could get interesting … and just proposing …

• to get into the commercial, institutional, property management markets, will Google / Nest pursue distribution to reach these markets with new products or go direct or have selected partners … perhaps work with building control companies … or maybe distributors
• if Google wants to be “in the home” with “Internet enabled” products, could someone like a Leviton or a Lutron, through the lighting control systems, be potential acquisitions for Google.  Both of these companies offer access to residential, commercial and institutional markets.
• could Google pursue an LED company given that, at some point, LEDs will also be wifi spots (we’ve seen 4 different reports of technologies that are testing this capability).