SSN Readers: Google eyeing security

Sixty-four percent of SSN readers say Google’s $3.2b buy of Nest portends Google’s launching a home security product
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Wednesday, February 5, 2014

YARMOUTH, Maine—Google’s recent acquisition of home automation company Nest Labs led many to believe the tech giant was setting up a beachhead on the industry’s shores. Readers who responded to a recent SSN News Poll tend to agree, with many saying Google’s buy is no half-hearted entrance into security—it’s a sign of ever-larger involvement in the residential space.

Seventy percent of respondents believe Google will become a major home automation provider, while another 64 percent say Google will end up launching a home security product too.

That’s not necessarily a bad thing, many readers say.

“The industry needs to advance technologically and I feel Google will bring new technology to the marketplace and force some of the old companies to step up their research and development efforts,” one respondent said. “Way too many old technologies are being installed in today’s market. Go Google, and bring us some new items to sell and install.”

But some responses were more alarmist in tone. “All the alarm companies are in trouble,” one reader said. Not all were convinced they’d reap the benefits of the greater market awareness a company like Google can generate through advertising clout. “All this will do is hurt the small business, and drive down profits for everyone but Google.”

Reginald Blakely, product manager at Monitronics, said it’s too soon to tell whether a home security product is in the offing for Google. “However, Google offering a monitored home security product does not appear to fit their traditional path,” he said. “They could easily offer a DIY security addition to their Nest product line. Google could easily leverage home automation to the 75 percent of the market that does not have or want a monitored security system.”

An influx of new players from outside the industry, one reader noted, is increasingly becoming a reality for an industry moving rapidly in a more technologically sophisticated direction. Moreover, 62 percent of respondents believe security and home automation companies will benefit from Google advertising its new products. “Nothing wrong with new players. It’s a tech game,” the respondent said. “However, many of these new players offer services and equipment that [are] the illusion of security. It is not as hardy or tried and true as traditional equipment. Some providers are calling it ‘security lite’ or ‘lifestyle monitoring,’ so that tells the story.”

Henry Edmonds, president of The Edmonds Group, a St. Louis-based investment bank, has done presentations on Google’s possible entry into security. He believes it’s unlikely the company will drift so dramatically from its core brand. “Google is in it for the data,” he said. “They don’t want to be a hardware or security company.”

But a strong current in the responses was that the situation bears watching—especially in view of the enormous capital and tech talent Google has at its disposal. “To say the least, Google has proven they are very capable of developing and expanding the reach of services,” one respondent said. “It is very early, but at this point anything is possible.”