They have over 100 people, and if rumours are true have quite significant backing. Which is particularly interesting as it's hard to see on the surface where their margins come from on a device most could consider as novel and expensive.
Though there are potentially gains to be had from a smarter thermostat, the headline figures in their white papers will most likely never be realised in the real world. Most reviews and bloggers seem to get caught up in focusing on the simple heating and cooling experience.
The company on makes sense once you look at it in the context of the larger market. The silent but important features are zigbee integration (current unused), and excessive processing power. We are just on the cusp of huge smart-grid rollouts in many western countries. British gas in the UK has decided on the zigbee standard and are starting to roll out over 1000 new meters a day; with government backing for an £11bn rollout to 27 million households by 2019.
In light of these rollouts, the energy companies will be looking to capitalize on their investment (which will be mostly funded by the consumer, via higher bills). The hardest part is figuring out what the consumer face of the smart grid should look like. Expensive 'home hubs' and touch screens are a red herring - the future is distributed (every household members phone etc), yet you still need a link between the rather 'dumb but integrated' meters, and devices in the house.
In my opinion nest's game plan is to become that link. Your thermostat controls around 50% of the energy usage in your house. Eventually it has the potential to control 100%. With smart GPS integration into your phones it becomes realistic to have houses that react silently to it's various inhabitants patterns and blend those needs with the energy grids demand levels; now this is a valuable proposition. If you're an energy company absorbing several billion because of government pressure, suddenly the hardware cost of a nest doesn't seem so bad, especially if it can be offset or laid off over time.
edit; footnote - All figures are rough (off the top of my head)
But even before the Ecobee, programmable and even WiFi-enabled thermostats have been around for many years and they have not gained any significant traction. My dad owns an HVAC company and they've only sold 1 or 2 Ecobee units in the years they've stocked them, with most people just opting for a schedule-based programmable thermostat.
What makes the Nest so much different? Is it just that it's pretty? Right now, their website says it costs $250. For the average person, that's probably at least a few years of energy savings needed to justify that cost.
Where did I say that I expected anyone else to do any of that? By my own words, they were silly hacks. My question was why the Nest is different than the Ecobee or any other smart thermostat that has been around for years. They all do the same things: smartly adjust to the outside temperature and usage patterns, provide data to the user about energy use, and allow control from the Internet or wireless network.
None of those examples actually answer his question, they just belittle it a bit, but the original question, and in fact all of those, are very valid.
I suspect the current hype about the Nest is due to two reasons: 1) Apple people made it, and Apple is newsworthy right now; 2) it doesn't look like other thermostats, it looks easy to use and unique. I think that right now the Nest's aesthetic is getting it traction, time will tell if that's enough to get it sales.
In my opinion market timing is the difference. There are a few key factors. Wifi penetration is coming over 80%. After a long drawn out process zigbee is emerging rapidly as the defacto wireless standard, and I suspect we will see this being consolidated over the next 3-6 months. Hardware costs to build a truly smart system have been driven lower by the boom in smartphone chips and batteries. The smart grid is coming, and it's government backed.
Homes HAVE to get smarter. The market dictates this. But up to this point, the cost to gain ratio has been far out of balance, not to mention the approach of poor quality touch screens and feature lists that read like a 1999 computer spec :) I agree nest is too expensive at $250, but I doubt that it will hold that price tag for long, partnerships are coming I'm sure.
It's a little like asking what made the iPhone different to the nokia of the day, or Dropbox to FTP. It's more about market timing, pricing and user experience than anything in a spec.
What else? Put bluntly; timing, founders and funding.
It's just pretty drives a lot of consumer household purchases already. And nest may cost $250 now, but in 3 years it can easily just cost $50. The zeo sleep monitor had a similar price trajectory, starting at around $400 and now is around $100. Similarly with the kindle and other e-ink devices.
Not sure why you're getting attacked. I think the advantage is a combination of nicer design and better PR ("brought to you by the fathers of the iPod", etc). A very Apple-like approach to product. Which works on many folks, myself included.
I think it's far bigger than just energy usage/control. In time, more and more devices in the home will become 'connected' in some sense. If Nest can be the first such product that people want in their homes, then I can imagine a whole ecosystem of other devices/services piggy-backing off it.
> With smart GPS integration into your phones it becomes realistic to have houses that react silently to it's various inhabitants patterns and blend those needs with the energy grids demand levels; now this is a valuable proposition.
That's an interesting point. Here in Ontario we have smart electrical meters so that the hydro company can charge you different rates depending on the time of day; running the A/C during work hours is more expensive than running it at night, and so on. It would be interesting if household devices were aware of these cost-of-power schedules so that you could put laundry in a dryer and set it to "dry in the 12 hours, whenever electricity is cheapest".
Yes exactly. And furthermore the proposition is even more interesting when you consider that as a consumer you don't actually want to think about these things.
Running the washing machine at night when it's cheapest may not be desired, rather running it when no one is home and it's off peak. Turning on alarms, switching off lights, dropping temperature automatically. Allowing individuals in the household to have their own work patterns and temperature presets etc.
The key point is that it has to be effortless. No complex interfaces or setup. Plug, play, forget. And only in the next 12-24 months do enough technologies hit critical mass to make it economically feasible.
Excellent post, but remember that internet providers like Comcast are taking steps to do that same thing. Nest has the hooks into the power system, but Comcast controls the gateway to the larger internet and interfacing with things like your smartphone.
How this sill interact with the ZigBee push for IPV6 integration, for the Smart Energy profile at least, is anyone's guess.
In the UK the implementation currently being rolled out actually runs the smart meter on the 2G GSM network, as a ZED (zigbee end device) the nest could actually pipe data directly to the energy companies with no other connectivity beyond the electrical grid. The company running the 2g network (vodaphone) in this case, is actually in contract directly with the energy provider. Now in terms of interfacing with your smart phone this is impractical, you still need wifi (most likely), however, considering the traffic is encrypted, I doubt that the providers really have much leverage here.
Well, yes and no. It's a lot easier to tackle the profile interoperabilty issues if you're the gateway between the ZigBee and non-ZigBee network. The energy providers don't quite have the same experience at being "user friendly" at a customer level.
Not that the company I work for really cares either way. Power companies are looking at smart grids, white good manufacturers are looking to include network functionality, and several people want to be the bridge between you and all of this. But as long as most people building ZigBee devices use our chips, we're happy.
Comcast controls one gateway into a home's internet - there are others - including wireless 3G. In fact this hn article detailed how a woman was charged for hack said gsm card tied to her smart power meter