
Nest’s time at Alphabet - suprgeek
http://arstechnica.com/gadgets/2016/06/nests-time-at-alphabet-a-virtually-unlimited-budget-with-no-results/
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ChuckMcM
This sums up Google in a single paragraph:

 _In 2015 Nest posted job listings for its "Nest Audio Team." The team would
be responsible for "developing an audio roadmap for Nest products." Industry
observers suspected the audio team was building a smart Bluetooth speaker, but
Google beat Nest to the punch with Google Home, an Amazon Echo-style Bluetooth
speaker and voice assistant appliance. According to a report from The
Information, when Nest found out about Google Home, it asked to work on the
project with Google. Nest's request was turned down. We can only guess
why—maybe Nest's reputation inside Google had something to do with it?_

Often times Google has multiple projects doing effectively the same "thing"
going at the same time. They don't work together because the idea is to have
the team that can get to the "finish line" first to win, not to co-operate.
This, as it was explained to me by an engineering director there, was to
encourage a 'natural selection mechanism that selected for the best teams and
the best products.'

While I understood the idea, that you would pit your own resources against
each other like that was kind of foreign to me. My own personal learning from
that, having watched them for 15 years, four of which from the inside, is that
as a way of managing a company it produces few viable products and no viable
businesses.

~~~
fiatmoney
The notion of internal competition is really tricky, since you're also
competing externally. If you believe in the classic explanations of the theory
of the firm, "companies" exist so they can be effectively communist on the
inside in an attempt to lower transaction costs. If you have teams competing
against each other directly for resources, time-to-market, etc. you don't
really have a reason to be a single company anymore.

OTOH, a little bit of internal competition to penalize complacency, if there's
not too much wasting of resources, is probably a good thing. It's been fairly
common IME for different teams to be working on very related concepts (eg, HPC
platforms for different tasks), with a sort of implicit understanding that the
team that does well will be able to do the logical extension of the project,
and the team that doesn't will work on something else.

~~~
jsprogrammer
Where can I find more information about the theories that claim companies
exist to be communist?

I don't buy the "first to win argument", but it would seem useful to take
multiple approaches to solving the same or similar problems.

~~~
abtinf
"Communist" is a loaded word, but it gets at the idea.

One of the thorniest problems in business economics is this: we know free
markets produce extraordinary results, but why is it that even in the absence
of regulation, so little of the economy is structured as a free market? Very
few businesses of any size operate internally as a market, instead they
usually operate under hierarchical command and control. Markets generally
exist only at the interfaces between organizations.

Why don't teams bid competitively within a company? How do individuals decide
on the teams to form? Why are managers allowed to rise to the point of
failure? Why do we pay people salaries instead of hourly wages? Why do we hire
hourly wage labor as if though its was permanent?

The number of questions raised by this topic is endless.

The most general explanation is this: yes, companies adopt inefficient
structures, but they more than make up for this through significantly reduced
transaction costs.

~~~
bane
In highly competitive environments, humans tend to adopt a "single executive"
type organizational structure. In short, there needs to be a single decision
maker who can set strategy, make decisions, approve direction and so on at at
least the rate of the competition. Committee systems work fine when things are
more steady state and there's less existential threat.

Nations almost all adopt an executive system because nations compete. The U.N.
doesn't because Earth doesn't have to compete with anything else. Imagine a
competitive interplanetary situation and you can bet the Secretary General of
the U.N. would quickly gain significant decision making powers.

Collectivist market philosophies tend to be built on the assumption that there
will be no competition internally and thus can be run by various committees.
However, even countries trying to follow various types of collectivist
ideologies ended up with single executive-types at the top, again because
countries compete.

On the small scale, many indigenous tribal systems rely on a council during
times of peace, and elect an executive (sometimes called a "war chief") during
times of war.

The phrase "business is war" is particularly appropriate since most businesses
operate like they're at war.

~~~
wtbob
> On the small scale, many indigenous tribal systems rely on a council during
> times of peace, and elect an executive (sometimes called a "war chief")
> during times of war.

That's how the Roman Republic operated, too: the Senate would elect a dictator
for six months to handle certainly irregular situations. Unlike any other
Roman official, he had no colleague who could countermand his orders, and he
was not legally liable for any act he committed in office.

------
dexwiz
IoT is a fad. I have yet to see very many convincing arguments on why my house
needs to be online. The existing products (locks, sensors, smoke detectors)
are barely different from existing home security products that have been on
the market for years. The functionality of Echo/OnHub is largely covered by
smartphones. They promise integration with other home IoT devices that do not
exist yet.

People are very hesitant to buy new appliances/home products. The last major
change to the American home was the television, and that was ~50 years ago.
Desktops had their day, but have been largely replaced by Laptops/Smartphones
for many consumers. Adoption of new home appliances and technologies is
glacially slow.

Also newer electronics have shown they need replaced/upgraded every 2-5 years.
You are going to be hard pressed to sell the idea that the consumer needs to
replace all their light switches and smoke detectors even every 10 years. I
barely replace light bulbs at that rate now.

Cars about the only place where the IoT call home paradigm works. They are
complicated machines that need semi regular maintenance. Placing sensors all
over it makes sense. Trading updates for telemetry is attractive because a
cars computer needs updates like any other computer. But I don't need a fridge
that senses when I am low on milk, when I can just as easily look inside it
and tell for myself.

EDIT: I think I should clarify that home IoT is a fad. Having machines feed
back telemetry is useful, especially commercial machines with a service
contract. The data is useful when its actionable. Data for the sake of data in
the home is a waste.

~~~
joezydeco
IoT is a fad in the current way we're going about it.

What's not a fad is getting devices to communicate their health and status to
an upstream repository for things like predictive analytics.

This is already happening in the B2B sector. It will reach the consumer sector
next, but like you said it will take 2-3 consumer product cycles to make it
real.

It won't be about remote control or any of the barely useful use-cases you're
seeing with fridges and door locks and water bottles. It will be knowing your
home's A/C has two weeks of operation before it seizes up. It will be knowing
your home's plumbing has frozen and burst while you were away.

~~~
dimino
The "TV in the refrigerator" IoT is definitely a fad, but you're right,
there's a fundamental need to connect devices together and to a central
managing/monitoring service.

~~~
discreteevent
There is also a fundamental need to have those devices be secure. Consumers
take this for granted because they have been secure for so long. They don't
know what's coming. And when they find out then there whole thing will
probably blow up. It just takes a few companies to tarnish it for everybody
else.

The problem with IoT is the I

~~~
acdha
The problem is the lack of corporate liability. If they used some alternative
to the internet we'd be reading about how it makes the SWIFT network look
secure add long as the alternatives are “spend money and time doing it
responsibly” or “ship it now with a strong EULA”.

------
throwaway23716
As a Googler, a thus invested in the success of Nest as a business, I'm
fucking furious at Fadell's lack of leadership.

As an owner of many Nest products, and thus invested into the success of the
Nest ecosystem, I'm also fucking furious.

What a waste.

~~~
draw_down
Sure, but whose decision was it to buy Nest? Seems a bit silly to stop with
being angry at Fadell.

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awesomerobot
Doesn't Nest have like 1200 employees? What are they doing day-to-day? With
that many people it seems like you'd almost release a product accidentally.

~~~
simonswords82
Infinite monkeys in a room armed with type writers will eventually write
Shakespeare (or release a new product) but it'll take a very long time.

Nest needs to innovate and rapidly evolve products very quickly to keep ahead
of the market, which it seems includes their colleagues (madness).

Given a team of that size and complexity nothing but the best management will
get products out the door.

Reference:
[https://en.wikipedia.org/wiki/Infinite_monkey_theorem](https://en.wikipedia.org/wiki/Infinite_monkey_theorem)

~~~
snowfield
Infinite monkeys will make it infinitely fast :P

------
TheGuyWhoCodes
That's a nice 3B$ flop right there, 3.5B$ if you take the dropcam into
account. Why couldn't they just focus on small inexpensive products that sell
without thinking? Take chrome cast for example, great product, cheap price,
don't really have to debate if I want to buy it.

Hey Google, here is an idea, why don't you make an IoT button that can
talk/control other devices like bttn or flic but costs just 5$ (I'm looking at
you Amazon dash). They will sell like hotcakes!

After that you can introduce some other products, maybe under the home brand,
like a device that control your AC (it just needs to work, doesn't have to be
apple like the Nest) or one that monitors your water heater. What about a
small device that checks for leaks in your pipes. There is so much stuff todo
here.

~~~
petra
The chrome cast can bring digital advertising to the TV, and offer Google some
control.So they can sell at cost.

What does the a button or a flood sensor buy them ?

~~~
TheGuyWhoCodes
I don't think they get much more in ad revenue because of chrome cast, if I
want to watch something I'd watch it on my mobile or PC, casting to the TV is
just more comfortable, it's not an enabler to something that wasn't watchable.

Moreover chrome cast is used outside of google products like Plex, Netflix,
HBO etc.

Having a low bar for entry into the home is huge for a company which is all
about data and insights.

------
danso
The debacle of the smoke alarm made me immediately regret buying one of my
friends for their newborn son's room. But wow, the following sounds like an
utter fail...if quadrupling the headcount doesn't bring new products, then you
at least expect the old product to have tried overexpanding into new
markets...they weren't even able to do that:

 _Even by Fadell 's own standards, the Google acquisition doesn't seem to have
led to huge wins for Nest. In an interview with Bloomberg shortly after the
sale, Fadell was asked what the move would mean for Nest. "For us it was about
getting out to the world faster" Fadell said. "[Our products are imported] in
96 countries where we don't even sell today. We can see these devices being
connected but we can't get there fast enough. For us, going with Google, we
can get access to resources to allow us to move these products around the
world much more quickly." Before the Google acquisition, Nest was for sale in
three countries. In two-and-a-half years under Google and Alphabet, Nest
expanded to just four more countries._

------
Animats
Alphabet trashed their robotics companies. They trashed their IoT companies. I
hope they don't trash the self-driving car operation.

~~~
kilroy123
At this point, I doubt it will matter much if they do. Many other companies
are working on it now. Eventually, one will get it right, and the auto
companies will copy/follow.

~~~
ghaff
Or it will be the auto companies that turn out to get there in the best
incremental practical way.

I know this is probably a minority opinion here, but one plausible scenario is
that 5 or 10 years from now, Google will come to the realization that full no
steering wheel autonomy is still "just over the horizon" and, in the face of
declining ad revenues (or whatever), the whole effort gets ramped down.

------
ericabiz
The article says Nest may be up for sale, which would make sense. I have to
think that the buyer would probably buy Nest for the underlying technology and
not the brand at this point, however.

I have an original Nest thermostat but would never buy another Nest product
due to the horror stories that continually pop up online. I don't follow Nest
closely or have any particular interest in them, but I remember the video they
reference in the article from the Google employee who couldn't stop the smoke
detectors from false alarming, and I also saw the news when they decided to
"brick" a $300 product they acquired.

Based on those two things alone, I don't feel like they take customer
satisfaction seriously, nor do I have confidence in their ability to build a
good product--even though my thermostat has never had any issues. I doubt I'm
alone in this.

~~~
aembleton
I'm very happy with my Nest thermostat. I have no desire for IoT smoke alarm
but I don't think I'd like to go back to an old style thermostat.

~~~
ericabiz
Oh, me neither. But today there are plenty of companies in the smart
thermostat game. A quick Amazon search shows 8 at a glance, only one of which
is a Nest.

------
revelation
_Nest grew from 280 employees around the time of the Google acquisition to
1200 employees today._

Holy.. what are they all doing?

------
j0hnj0nes
all of this comment and not a single one seems constructive...

Nest the company problem as consumers (myself being one) seems to be
Software...

I use the nest software and simply put it's not up to scratch

The Hardware is beautiful if only the software was...

For example the nest protect has temperature sensors yet the Nest thermostat
can not use these...

Nor can the software operate without access to the "cloud" even in a reduced
ability.

Google OnHub suffers from the same Software problems, Great hardware and nice
low level drivers however it cant even use IPv6 which for a router is pretty
basic

my advice for the incoming CEO, interoperability Simple

make use of thread & brillo (software) to unify things... (produce an alarm
but have the option of ADT as the responder)

Unify the products so they can work within a LAN and expand outside of the
USA.

I hope that helps

John

------
abritinthebay
I love my Nest thermostat- it's still better than any other smart thermostat
out there in build quality and reliability (tho the Ecobee series is slightly
more feature rich) - but I can't say I'm surprised.

Nest is, in many ways, the most disappointing company. I'm not sure how much
of that is just down to them lacking vision or leadership though - they have
the skills to do great things.

~~~
bratsche
I have a Nest thermostat as well, and I like it. I've wondered before if they
just had that one good idea and that was it. When they announced the smoke
detector my jaw dropped. It just seemed like such an awful idea.

I had thought maybe they would do a smart lawn watering system next. I know
it's a smaller market, but it seemed better aligned with the thermostat as
something that could be marketed as a money-saver. The smoke detector doesn't
save you any money, it just seems like a solution in search of a problem. The
lawn system could basically sell itself: local rebates on the up-front cost,
the promise of saving you water/$$, and the name that Nest had already
established from their thermostat.

There are some other companies making products like this now, but I don't know
if they're good.

~~~
lstamour
Drives me slightly crazy seeing lawn sprinklers going while it's raining and
humid...

~~~
Anechoic
_Drives me slightly crazy seeing lawn sprinklers going while it 's raining and
humid.._

The underground sprinkler system my parents installed 30 years ago has a
sensor to prevent that, it's certainly not unusual. It would be interesting to
see rain sensors for regular sprinters although I'd be shocked if they didn't
already exist.

~~~
perishabledave
Haven't tried it, but Rachio makes sprinkler valves that adjust based off of
weather reports.

------
mtgx
I wonder if it had crossed Google leaders' minds that Nest would fail _after_
acquiring them because people don't trust Google to gather their data.

~~~
cbr
It doesn't look to me like that's why Nest failed?

~~~
awesomerobot
not even remotely related

------
1945
Hacker news is oddly obsessed with negative Nest press. Suspiciously so.

~~~
mwfunk
Well, it's not like there's been any positive Nest press in the last year or
so to obsess over.

Based on the stories, what's been happening at Nest is an extreme case of many
of the same organizational antipatterns that people in the tech industry see
in their own companies on a smaller scale. The things that have happened at
Nest (if the stories are to be believed) are like cancer to a tech company. If
left unchecked those antipatterns can grow and consume a company, and can
ultimately kill it. No amount of reform will save a company if they can no
longer retain talent or recruit replacements of the same or better caliber.

Given that so many HN readers are in the tech industry themselves, they
probably worry about these kinds of cancers taking root at their own companies
(I know I do). This stuff exists everywhere, it's just that for stable
companies it's the exception and not the rule. I'm not surprised that it's
been a hot topic.

~~~
1945
> Well, it's not like there's been any positive Nest press in the last year or
> so to obsess over.

Their performance versus the rest of the Google ventures? The product line
that was previously leaked? And, in the eyes of Hacker News perhaps
celebrating Tony stepping aside.

A lot of these stories, if they are in fact true, likely happened prior to
Google acquisition and those people are now just feeling comfortable to speak
out without the fear of it being spun as retaliation.

I have a lot of faith that the Google HR department wouldn't tolerate any of
the behavior, which is why it smells like a marketing campaign.

