Google risks alienating existing customers with its ever-changing smart home strategy (GOOGL, GOOG)

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Google announced a new screen-equipped smart home device and rebranded another key device in its connected home lineup to put the Nest brand at the core of its approach to the home.

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The branding change and features of the new Nest Hub Max are another attempt by Google to move its smart home products away from association with its core brand and from points that it was putting front and center a few months ago.

Here’s what is means: Google’s latest changes to its connected home lineup are redefining its strategy for the space and changing the market its devices seem framed to appeal to.

The new Nest Hub Max is an Assistant-powered smart display with a 10-inch screen and a camera. The device leaked on Google’s store last month and is the search company’s second screen-equipped smart home device after the initial Home Hub. Google pointedly didn’t include a camera in the Home Hub in an effort to assuage consumers’ fears over privacy within their homes, instead positioning its smart home devices as primarily providing information. But with the Nest Hub Max, Google has markedly pivoted on its messaging by equipping the device with a camera. This could push away privacy-minded consumers.
Both versions of the Hub are now part of the Nest family, rather than being part of Google’s own branded lineup. Last year Google integrated Nest — which had been an independent Alphabet company — into its hardware unit, and now it’s housing its smart home efforts under the brand. Future iterations of its Google Home speakers will also apparently be slotted into this new branding. This could help differentiate Google’s connected home products from its mobile efforts and minimize possible confusion. It could also insulate Google’s core brand from the negative impact of smart home-related privacy concerns and its smart home efforts from any issues stemming from the search or mobile business.

The bigger picture: Google’s ever-changing approach to the smart home space risks alienating those who have already bought its devices and turning away those considering it.

The company’s emphasis on privacy — centered on a lack of cameras in the home — has given way to camera-equipped home devices that can perform the functions of a home security camera. And by moving away from using the Google brand in much of the home space, it will shift away from a unified digital offering through which consumers could put Google in all its various iterations at the center of their digital lives. Nest devices will tie into Google, but with the separate brand, they aren’t as clearly incorporated into the wider ecosystem.

While Assistant-powered voice devices look set to continue to grow as a share of the estimated 500 million smart speakers that will be installed in the US by 2024, Google could lose momentum and push a larger share of consumers toward Amazon and Alexa if they’re unsure what to expect from buying into a Google ecosystem.

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Source: Business Insider – pnewman@businessinsider.com (Peter Newman)