Google's Business Plan For Nest: Selling Your Data To Utility Companies

jfruh (300774) writes "Google spent $3.2 billion on Nest. How is it going to make its money back selling high-end electronic thermostats at $250 a pop? Well, keep in mind that Google is a company that makes its money off information, not hardware. In fact, Nest is developing a healthy revenue stream in which it sells aggregated user information to utility companies, to help them more efficiently plan their electricity-generation scheduling. The subscriptions net Google somewhere in the range of $40 per user per year."

But they already bill me

[scorp1us]

The power company already knows how much I use and when. In fact they send me this energy statement saying I'm using 10% more than my neighbors.

You are the product

[MikeMo]

Remember, with Google, you - and what you do online - are their product. That information, and your "eyeballs" are what they sell. Expect them to behave accordingly.

OMG, ConEd will know when i use electricity

[alen]

this is horrible, imagine if they could build out for peak capacity in the right locations for the right times so there wouldn't be anymore rolling blackouts in july and august

It's the Google way

[Anonymous Coward]

Google is a one trick pony. From robot cars to balloon-based internet access to Android OS, they still only have one business model: selling advertisements. 96% of Google revenue is generated via advertising channels. Take away the advertising and Google as we know it is gone.

Re:But they already bill me

[Anonymous Coward]

But they don't specifically know how much energy goes into heating and AC, vs. other household uses.

Say it looks like there's going to be a heat wave next week, it's going to be 100+ for a couple weeks straight, how much extra energy are you going to use (and by extension everyone else like you). If you're using 10% more energy than your neighbors because you're growing pot your increased demand is going to be lower than if you use 10% more energy because you keep the house at 55 degrees to slow the decay of your roadkill collection.

Re:You are NOT the product here.

[ledow]

This isn't about snooping, per se.

What you describe is infinitely more about the grid getting it's own way. When demand is "too much", they can turn off the least-profitable areas to concentrate on the most. Without their consent. And when demand is too low, they can allow your devices to ramp up without question.

It's about stripping the grid to the barebones to chase profits, and then - when the bare bones can't cope - turning off the demand at the source. Sure, you'll be annoyed that your power just went off, but at least the shop next to you that's part of a chain that gives them a lot of money wasn't affected, eh?

And what you end up with is NOT a stable grid. You end up with - to the home owner - an unpredictable one. Which means you have to put money into alternates if you want stability. And any kind of partitioning plan of the kind "this is my life-support, don't turn it off" / "this is the pond pump, you can switch it off when you like" is not only ripe for misuse, but also incredibly privacy-intruding too.

Fact is, they are keeping up with demand. They pretty much always have. The profits from the energy industry (note profit = AFTER investment in the network) are obscene. This isn't about coping for the future, or paying lip service to the latest political demand of sticking some money into rival products that - if successful - would kill your own industry overnight, or maintaining a stable network.

It's about cutting off Joe Bloggs' heating right in the middle of winter because he's only on the basic electricity tier, and hasn't yet upgraded to "Enegy Prime" and it's extra monthly subscription that ensures he won't get cut off.