From Tony Fadell's Nest bio page: "Tony led the team that created the first 18 generations of the iPod and the first three generations of the iPhone. Before Apple, Tony built the Mobile Computing Group at Philips Electronics. Tony has authored more than 300 patents."
He brings a lot more to Google's table than just his current products.
I still think it was worth it for them. Google has a very large war chest too and four month profits isn't that bad for what they are getting. I think this was a great move for them. Even if a lot of people on here can't admit it.
Did they have any acquisitions for that quarter that were taken out of their quarterly net profits? They seem to like to acquire companies at inflated prices.
Your beats analogy is either a bad example, or you missed my point.
<p style="min-height:18px;"> </p>
Apple could have effortlessly pushed Nest into whatever Apple would have wanted it to be. (Nest has great bones)
I think the real thing is just that Apple doesn't want to buy an actual product that is already on the shelves. They just want to buy technologies. (Fair enough). But Nest is a better than 'decent' product. And Apple DOES like them. And Apple could have integrated it easily into an Apple home automation system.
But I'm sure Apple had their reasons for not buying them.
<p style="min-height:18px;"> </p>
(This is me making an obvious assumption that Apple was ever in some sort of position where they did, actually, decline an offer to buy. I haven't heard that yet.)
From what the media is reporting Apple was not looking at nest. We'll never know why, but my guess is if Apple really was interested and felt nest was a good fit they would have made an offer. I think it could be as simple as you say - Apple wants to buy technologies, not products already on store shelves. Maybe Apple is already working on their own home automation products or maybe they didn't think nest had any IP worth $3B. Or maybe they weren't interested in buying Tony Fadell and didn't know how he would fit into the executive team. As I said before, there's a reason Jobs never offered him the devices engineering position and instead hired Mark Papermaster. So maybe Fadell wouldn't be a good fit culture wise (ala Forstall).
Did they have any acquisitions for that quarter that were taken out of their quarterly net profits? They seem to like to acquire companies at inflated prices.
Not sure. Their net income for Q1 2013 was $3.3B and Q2 2013 was $3.2B. Bottom line is Google doesn't make billions in profits each month.
I noticed that I had exaggerated prior to your response and had already fixed it. That said they still make enough to buy a Nest every four months from now until forever and that wouldn't even affect their 10s of billions in their war chest.
From Tony Fadell's Nest bio page: "Tony led the team that created the first 18 generations of the iPod and the first three generations of the iPhone. Before Apple, Tony built the Mobile Computing Group at Philips Electronics. Tony has authored more than 300 patents."
He brings a lot more to Google's table than just his current products.
Apple today announced that Mark Papermaster is joining the Company as senior vice president of Devices Hardware Engineering, reporting to Apple CEO Steve Jobs. Papermaster, who comes to Apple from IBM, will lead Apple’s iPod and iPhone hardware engineering teams.
Tony Fadell only oversaw the iPod division, and had very little, if anything, to do with the iPhone. And, according to multiple sources familiar with Apple’s engineering management, the iPod Touch has been produced by the iPhone team, not by Fadell’s iPod division. The last new product that Fadell oversaw was the new iPod Nano.
Seems to me Fadell is stretching things a bit saying he led the first 3 generations of the iPhone. Forstall obviously was responsible for iPhone Software, Ive hardware design. And Papermaster was hired in 2008 to run iPhone hardware engineering (to then be replaced by Bob Mansfield. I'm a bit skeptical of Fadell's claim that he was responsible for the first 3 generations of the iPhone.
I noticed that I had exaggerated prior to your response and had already fixed it. That said they still make enough to buy a Nest every four months from now until forever and that wouldn't even affect their 10s of billions in their war chest.
Doesn't hurt that Wall Street basically gives them a pass. I mean MM was a $12B acquisition and for what? It's barely profitable (if at all).
Doesn't hurt that Wall Street basically gives them a pass. I mean MM was a $12B acquisition and for what? It's barely profitable (if at all).
True, But I think they are playing the long game. I think that Google is in a place right now where they are trying to move into manufacturing. Motorola provided that and also the IP portfolio. This post also made me think, I guess they could also hope that the Nest designers could help make some elegant Motorola phones. This could help them slowly get some of their investment back.
True, But I think they are playing the long game. I think that Google is in a place right now where they are trying to move into manufacturing. Motorola provided that and also the IP portfolio. This post also made me think, I guess they could also hope that the Nest designers could help make some elegant Motorola phones. This could help them slowly get some of their investment back.
Not sure what that MM IP portfolio has done for Google. And since Google is basically all about data, I'm not sure what the point of getting into the hardware business is. I know you're just speculating, but $3B seems like a lot to pay for some Nest designers. What has Fadell designed besides the iPod and now a thermostat and smoke detector (that looks kind of like an Apple TV)? And even with the iPods, the aesthetic design probably came from Ive's design team, not Fadell.
Looks to me that you are totally right. Google has been making some great decisions and playing to their strenghts. Larry Page is a fantastic CEO.
Meanwhile Apple has 160 billion staying still. Money like that = 0 if it isn't beeing put to good use. Of course, some members will come here saying that money doesn't make good produtcs, but Waze could've been a great "weapon" for Apple Maps. Sparrowfor Apple mail. etc.
What you and me must keep in mind is that Apple is the most powerful and innovative tech (and non-tech) company around, and they aren't here because of something as trivial as luck. We don't know that their main goal is. At any time, any moment, they can make a 200 billion investment into something and leave everybody else 10 years behind.
heck, something as trivial as buying T-Mobile and a shit load of spectrum and integrate all that on free imessage and facetime calls, icloud mail and sync + 300mb LTE would put the whole industry in flames.
We don't know sh*t, and that's frustrating.
Of all of Google's recent acquisitions, Waze is the only one where I think Apple missed out. Meebo and Sparrow were mostly acquihires and Apple has been doing that constantly. Also, Meebo and Sparrow aren't even on the same scale as Nest. I think Nest is a cool company but isn't worth $3.2b. Maybe their product roadmap and patents are where the action is at. In the end, it's a huge transaction. Apple wasn't even part of the Nest conversation. Google has been involved in two large rounds of funding for Nest (Series B & Series C) and Nest was in talks with them even before they launched.
Apple on the other hand doesn't really need what Nest provides right now. They have a large hardware division and have crazy good hardware engineers. Nest wouldn't bring anything to the hardware table that Apple couldn't do on its own. Tony Fadell hasn't been at Apple for a long time and I think Apple's current hardware is its best, so it's not like they are struggling for hardware folks. Nest's software is a bit different, but not $3.2b different.
Personally, I am eager to see what Apple has been working on. The last couple years have been transitional, whether it was the passing of Steve, Scott Forstall leaving and being without a head of retail for quite a long period of time. Even that knuckle head Carl Icahn was/is a huge distraction. Things are starting to settle in some respects. I think 2014 is going to be a crazy year.
Doubt it. Jobs was apoplectic about Android, supposedly, but that did not stop him from running Google search and Google maps on the iPhone.
Jobs used Google apps when the iPhone was new. After Android he said he was going "Thermonuclear" - and thats why Apple switch search to bing as default and Apple developed their own mapping.
Of course, I'm assuming we'll all now have to link our Nest accounts with Google+ (I wish I were kidding).
I've become increasingly resistive to logging into the Google monopoly on websites. I stay logged out of Google unless checking Gmail, and I never bother logging into YouTube to comment or even rate (not a real loss there). Why? My Internet searches are my business, not for marketing purposes. I hate both marketing and advertising in specific. There's almost zero accountability and advertising seems to be nearly 100% misdirection and lying. Between corporate news agencies and advertising, there's so little truth and reality out there. I want nothing to do with advertising agencies, but Google snuck into my life when I wasn't paying attention to what they really were.
On one hand, they're a fantastic example of what's possible with capitalist market funding, and on the other hand they are a frightening example of how capitalism eats its own market. There are so few companies out there. Go grocery shopping and try to find product not owned by five to ten parent companies. Almost everything we buy in the USA is pretty much from about ten corporations.
Another overhead serve aces right past Apple. Thanks Tim.
Quote:
Originally Posted by hmurchison
"Innovation is in our DNA"
Could have fooled me Tim.
1. When did Apple ever buy a company selling a separate retail line of hardware products ((or at least continue to operate it as one)?
2. As the article pointed out, Google already had a piece by being the venture capital arm and were therefore working closely with them ever since that relationship started.
Pretty straightforward really.
PS: By the way, most of Apple's recent acquisitions seem to make fairly excellent sense. And whoever spearheaded and then honchoed/midwifed the move to the A-chips are some dudes that deserve huge props.
Apple's best strategic decision of the decade that's making their differentiation lasting. Lack of control over their chip destiny in the Motorola/IBM Power PC chip days cost them a ton of momentum at a critical time.
No such possible roadblock this time - they own their own destiny in product evolution in most of the key areas.
And if they want to go where Google and MS aren't (as well as take them on head to head in other areas), you might see them acquiring, for example, battery technology - and any other parts of their devices where in-house innovation could give them that edge that other companies can't reach with commodity components.
Quote:
Originally Posted by anantksundaram
Um... what is Google's strategy here?
Quote:
Originally Posted by SpamSandwich
Yes, what is Google's strategy? ...
They want to own automation systems (cars, homes, personal robots)...
...I believe they are following the advice of Ray Kurzweil ... but these are all nascent industries and there is no proof that any of them are big money makers, nor is there any guarantee any of them will be anything but a massive money sink for the foreseeable future.
If Google can continue to fund money losers (as a type of very long term R&D) it will be bad for their immediate and near term, but possibly be of benefit in the long run. ....
Disclaimer: I'm platform agnostic. I use OS X, iOS, Windows, and Android for diff purposes - and sometimes because I'm just a cheap bastard and will settle for an adequate solution to a low priority need.
Anyway, I believe these are all real deal major future industries - and part of where the action's already shifting. Everybody in the world may have a well-built, long-lasting, affordable iDevice or two in 5 or 6 years - markets mature. Ask any PC maker.
So, some of what Google's after in the what's-after-smart-mobile-screens world:
*A foothold in the "I of T" - check.
*Building on the model of becoming a force in hardware through acquisitions which are operated as mostly autonomous subsidiaries, a la Motorola (the Moto X's camera sucks badly, but is otherwise a sweet deal off-contract, e.g., and they're on course to move a ton of Moto G's in quite a few countries)
*Robotics - check. (An acquisition of something like iRobot [I don't know their status at all, just an example] would totally cement my argument above.)
*The Living Room (remember the living room?) - Chromecast is a nice little $35 solution to enough of many people's needs, and it's only the tip of what they're pouring into TV, including partnerships.
*Media - the whole Google Play thing is good enough for most people and it's on more devices around the world, so even if Apple's skimming 75% of the cream, and Amazon has a loyal customer base, that's still a lot of milk. Oh, and YouTube.
And for personal media if you haven't noticed, most of what Picasa's always done is being integrated into Google+'s Photo Gallery (which automatically and permanently backs up every Android phone photo taken in G+). And along with a few editing tools, if you shoot burst photos, Gallery even automatically makes Motion GIF's. And auto-stitches pieces of video footage it thinks are related into edited movies with sound tracks. You don't have to like 'em or keep 'em, but hey, this is not your 2005 photo backup service. I wouldn't take the time myself, and kinda fun stuff.
*GMail's also living in G+ now - you can send a photo in a gMail from your G+ photo pages - and post it in your G+ stream. No uploading, no downloading, no trips between webpages. Easy-ecosystem-peasey check.
*Communications in general. G+ incorporates Hangouts as well as GMail and all your media... ...and Hangout's morphing into a combo of SMS, IM (in general as well as bringing gMail chat and Google+'s chat), voice calling, video calling and video conferencing - with simultaneous Google Docs collaboration and G-Drive sharing. Cross-platform too.
Long-term, facebook, and MS's Skype and Office divisions should be pissing themselves. Check and flush.
*The car. The self-driving stuff, some other initiatives and partnerships I can't think of right now, and the allure of standardizing on Google Maps (still Coke to anyone else's Pepsi - especially since it's on all the platforms). Check.
*Project Loon and bringing fiber to cities - becoming a world ISP - check.
*Reportedly looking into building their own server chips (fabless fab model) - since they're one of the largest server buyers in the world. And because they've seen the benefits to Apple (which might be actively considering upscaling their own designs for a similar purpose). Check.
*Etc.
*Etc.
And these all build up Google's data collection and marketing (ads and themselves) machine.
Peeps in Mountain View be thinkin' big. I'm kinda totally terrified of 'em, but also kind of in awe.
So I hope those at Apple HQ are thinking bigger.
Quote:
Originally Posted by StruckPaper
On one hand, they could be buying some Apple DNA.....
Bingo on that observation.... ...and that's probably chafing a few shorts in Cupertino tonight. They can deal, though. They were never gonna buy it.
Quote:
Originally Posted by hmurchison
What I want Apple to do here is let us know what side of the Home Automation are they going to come down on.
Me too. Best question posed in the thread as far as I read.
That seems to be the motivation for the steady drumbeat of "Buy Nest! Buy Tesla!"
Apple sensibly prefers to buy undervalued and/or mission-critical properties. Apple doesn't need to be in the car or home businesses. Apple's always prevailed through relentless focus and polish. Leave it to Google and others to play with thermostats and self-driving cars. They're cool, they get good press, but they're not markets that are ripe for the kind of shine Apple likes to put on its products.
Comments
He brings a lot more to Google's table than just his current products.
Google's net income in the September 2013 quarter was $2.9B. So they paid more for nest than they make in profit in a quarter.
http://investor.google.com/earnings/2013/Q3_google_earnings.html
I still think it was worth it for them. Google has a very large war chest too and four month profits isn't that bad for what they are getting. I think this was a great move for them. Even if a lot of people on here can't admit it.
Did they have any acquisitions for that quarter that were taken out of their quarterly net profits? They seem to like to acquire companies at inflated prices.
http://investor.google.com/pdf/2013Q2_google_earnings_slides.pdf
Not sure. Their net income for Q1 2013 was $3.3B and Q2 2013 was $3.2B. Bottom line is Google doesn't make billions in profits each month.
http://investor.google.com/pdf/2013Q2_google_earnings_slides.pdf
I noticed that I had exaggerated prior to your response and had already fixed it. That said they still make enough to buy a Nest every four months from now until forever and that wouldn't even affect their 10s of billions in their war chest.
http://www.apple.com/pr/library/2008/11/04papermaster.html note:this press release was from Nov 2008.
http://daringfireball.net/2008/11/executive_scuttlebutt
According to Gruber:
Seems to me Fadell is stretching things a bit saying he led the first 3 generations of the iPhone. Forstall obviously was responsible for iPhone Software, Ive hardware design. And Papermaster was hired in 2008 to run iPhone hardware engineering (to then be replaced by Bob Mansfield. I'm a bit skeptical of Fadell's claim that he was responsible for the first 3 generations of the iPhone.
Doesn't hurt that Wall Street basically gives them a pass. I mean MM was a $12B acquisition and for what? It's barely profitable (if at all).
True, But I think they are playing the long game. I think that Google is in a place right now where they are trying to move into manufacturing. Motorola provided that and also the IP portfolio. This post also made me think, I guess they could also hope that the Nest designers could help make some elegant Motorola phones. This could help them slowly get some of their investment back.
So much for buying a Nest smoke detector.
Looks to me that you are totally right. Google has been making some great decisions and playing to their strenghts. Larry Page is a fantastic CEO.
Meanwhile Apple has 160 billion staying still. Money like that = 0 if it isn't beeing put to good use. Of course, some members will come here saying that money doesn't make good produtcs, but Waze could've been a great "weapon" for Apple Maps. Sparrowfor Apple mail. etc.
What you and me must keep in mind is that Apple is the most powerful and innovative tech (and non-tech) company around, and they aren't here because of something as trivial as luck. We don't know that their main goal is. At any time, any moment, they can make a 200 billion investment into something and leave everybody else 10 years behind.
heck, something as trivial as buying T-Mobile and a shit load of spectrum and integrate all that on free imessage and facetime calls, icloud mail and sync + 300mb LTE would put the whole industry in flames.
We don't know sh*t, and that's frustrating.
Of all of Google's recent acquisitions, Waze is the only one where I think Apple missed out. Meebo and Sparrow were mostly acquihires and Apple has been doing that constantly. Also, Meebo and Sparrow aren't even on the same scale as Nest. I think Nest is a cool company but isn't worth $3.2b. Maybe their product roadmap and patents are where the action is at. In the end, it's a huge transaction. Apple wasn't even part of the Nest conversation. Google has been involved in two large rounds of funding for Nest (Series B & Series C) and Nest was in talks with them even before they launched.
Apple on the other hand doesn't really need what Nest provides right now. They have a large hardware division and have crazy good hardware engineers. Nest wouldn't bring anything to the hardware table that Apple couldn't do on its own. Tony Fadell hasn't been at Apple for a long time and I think Apple's current hardware is its best, so it's not like they are struggling for hardware folks. Nest's software is a bit different, but not $3.2b different.
Personally, I am eager to see what Apple has been working on. The last couple years have been transitional, whether it was the passing of Steve, Scott Forstall leaving and being without a head of retail for quite a long period of time. Even that knuckle head Carl Icahn was/is a huge distraction. Things are starting to settle in some respects. I think 2014 is going to be a crazy year.
Doubt it. Jobs was apoplectic about Android, supposedly, but that did not stop him from running Google search and Google maps on the iPhone.
Jobs used Google apps when the iPhone was new. After Android he said he was going "Thermonuclear" - and thats why Apple switch search to bing as default and Apple developed their own mapping.
Not Junk. Nest is a forward looking quality product. May not be long till they are no longer sold in the Apple stores.
Nest USPTO Patent Assignee listing:
http://patft.uspto.gov/netacgi/nph-Parser?Sect1=PTO2&Sect2=HITOFF&p=1&u=/netahtml/PTO/search-bool.html&r=0&f=S&l=50&TERM1=Nest&FIELD1=ASNM&co1=AND&TERM2=&FIELD2=&d=PTXT
Nothing in here that isn't competing with conglomerations having decades of patents already. The design patents nearly number the non-design patents.
People speculating about Thermostats and more don't know Honeywell, but I guarantee you I'm not the only Apple/NeXT alum who grew up with them.
http://yourhome.honeywell.com/home/
I've become increasingly resistive to logging into the Google monopoly on websites. I stay logged out of Google unless checking Gmail, and I never bother logging into YouTube to comment or even rate (not a real loss there). Why? My Internet searches are my business, not for marketing purposes. I hate both marketing and advertising in specific. There's almost zero accountability and advertising seems to be nearly 100% misdirection and lying. Between corporate news agencies and advertising, there's so little truth and reality out there. I want nothing to do with advertising agencies, but Google snuck into my life when I wasn't paying attention to what they really were.
On one hand, they're a fantastic example of what's possible with capitalist market funding, and on the other hand they are a frightening example of how capitalism eats its own market. There are so few companies out there. Go grocery shopping and try to find product not owned by five to ten parent companies. Almost everything we buy in the USA is pretty much from about ten corporations.
Another overhead serve aces right past Apple. Thanks Tim.
"Innovation is in our DNA"
Could have fooled me Tim.
1. When did Apple ever buy a company selling a separate retail line of hardware products ((or at least continue to operate it as one)?
2. As the article pointed out, Google already had a piece by being the venture capital arm and were therefore working closely with them ever since that relationship started.
Pretty straightforward really.
PS: By the way, most of Apple's recent acquisitions seem to make fairly excellent sense. And whoever spearheaded and then honchoed/midwifed the move to the A-chips are some dudes that deserve huge props.
Apple's best strategic decision of the decade that's making their differentiation lasting. Lack of control over their chip destiny in the Motorola/IBM Power PC chip days cost them a ton of momentum at a critical time.
No such possible roadblock this time - they own their own destiny in product evolution in most of the key areas.
And if they want to go where Google and MS aren't (as well as take them on head to head in other areas), you might see them acquiring, for example, battery technology - and any other parts of their devices where in-house innovation could give them that edge that other companies can't reach with commodity components.
Um... what is Google's strategy here?
Yes, what is Google's strategy? ...
They want to own automation systems (cars, homes, personal robots)...
...I believe they are following the advice of Ray Kurzweil ... but these are all nascent industries and there is no proof that any of them are big money makers, nor is there any guarantee any of them will be anything but a massive money sink for the foreseeable future.
If Google can continue to fund money losers (as a type of very long term R&D) it will be bad for their immediate and near term, but possibly be of benefit in the long run. ....
Disclaimer: I'm platform agnostic. I use OS X, iOS, Windows, and Android for diff purposes - and sometimes because I'm just a cheap bastard and will settle for an adequate solution to a low priority need.
Anyway, I believe these are all real deal major future industries - and part of where the action's already shifting. Everybody in the world may have a well-built, long-lasting, affordable iDevice or two in 5 or 6 years - markets mature. Ask any PC maker.
So, some of what Google's after in the what's-after-smart-mobile-screens world:
*A foothold in the "I of T" - check.
*Building on the model of becoming a force in hardware through acquisitions which are operated as mostly autonomous subsidiaries, a la Motorola (the Moto X's camera sucks badly, but is otherwise a sweet deal off-contract, e.g., and they're on course to move a ton of Moto G's in quite a few countries)
*Robotics - check. (An acquisition of something like iRobot [I don't know their status at all, just an example] would totally cement my argument above.)
*The Living Room (remember the living room?) - Chromecast is a nice little $35 solution to enough of many people's needs, and it's only the tip of what they're pouring into TV, including partnerships.
*Media - the whole Google Play thing is good enough for most people and it's on more devices around the world, so even if Apple's skimming 75% of the cream, and Amazon has a loyal customer base, that's still a lot of milk. Oh, and YouTube.
And for personal media if you haven't noticed, most of what Picasa's always done is being integrated into Google+'s Photo Gallery (which automatically and permanently backs up every Android phone photo taken in G+). And along with a few editing tools, if you shoot burst photos, Gallery even automatically makes Motion GIF's. And auto-stitches pieces of video footage it thinks are related into edited movies with sound tracks. You don't have to like 'em or keep 'em, but hey, this is not your 2005 photo backup service. I wouldn't take the time myself, and kinda fun stuff.
*GMail's also living in G+ now - you can send a photo in a gMail from your G+ photo pages - and post it in your G+ stream. No uploading, no downloading, no trips between webpages. Easy-ecosystem-peasey check.
*Communications in general. G+ incorporates Hangouts as well as GMail and all your media... ...and Hangout's morphing into a combo of SMS, IM (in general as well as bringing gMail chat and Google+'s chat), voice calling, video calling and video conferencing - with simultaneous Google Docs collaboration and G-Drive sharing. Cross-platform too.
Long-term, facebook, and MS's Skype and Office divisions should be pissing themselves. Check and flush.
*The car. The self-driving stuff, some other initiatives and partnerships I can't think of right now, and the allure of standardizing on Google Maps (still Coke to anyone else's Pepsi - especially since it's on all the platforms). Check.
*Project Loon and bringing fiber to cities - becoming a world ISP - check.
*Reportedly looking into building their own server chips (fabless fab model) - since they're one of the largest server buyers in the world. And because they've seen the benefits to Apple (which might be actively considering upscaling their own designs for a similar purpose). Check.
*Etc.
*Etc.
And these all build up Google's data collection and marketing (ads and themselves) machine.
Peeps in Mountain View be thinkin' big. I'm kinda totally terrified of 'em, but also kind of in awe.
So I hope those at Apple HQ are thinking bigger.
On one hand, they could be buying some Apple DNA.....
Bingo on that observation.... ...and that's probably chafing a few shorts in Cupertino tonight. They can deal, though. They were never gonna buy it.
Originally Posted by hmurchison
What I want Apple to do here is let us know what side of the Home Automation are they going to come down on.
Me too. Best question posed in the thread as far as I read.
Why? Because it's a 'cool' company?
That seems to be the motivation for the steady drumbeat of "Buy Nest! Buy Tesla!"
Apple sensibly prefers to buy undervalued and/or mission-critical properties. Apple doesn't need to be in the car or home businesses. Apple's always prevailed through relentless focus and polish. Leave it to Google and others to play with thermostats and self-driving cars. They're cool, they get good press, but they're not markets that are ripe for the kind of shine Apple likes to put on its products.