Dive Brief:
- Amazon has decided not to sell any of the newer products from Google's smart home division Nest, including the recently announced Nest thermostat and Nest Secure home security system, according to a report in Business Insider.
- Sources cited in the report said they were given the impression that the decision came directly from Amazon CEO Jeff Bezos. After Amazon's decision to stop selling new Nest products, Nest announced that it would no longer sell any of its products via Amazon once current inventory sells out. Sources said Nest preferred to offer its full portfolio of devices or none at all.
- The news comes as Amazon is looking to expand into territory that might make it more competitive with Nest. Last week, the Seattle-based company announced that it's purchasing Ring, a creator of "smart" doorbells that include cameras and other home security features, for a reported $1 billion.
Dive Insight:
By removing newer Nest products from its website, Amazon ramps up an already intense rivalry with Google in the connected home space, where the two companies' smart speaker devices — Amazon's Echo line and Google's Made by Google hardware — are already close competitors. The tech giants are racing to become the leader in this market, as both are building AI-powered voice operating systems, which are increasingly seen as a key channel for reaching consumers in the home. This rivalry has more frequently manifested in their marketing strategies, with Google airing Nest TV spots around the Oscars ceremony on Sunday.
Amazon's purchase of Ring late last month not only adds a greater number of devices to its suite of products, including smart doorbells, but also puts the e-commerce giant a step closer to combining its hardware with its delivery services, as Business Insider noted in a separate report. The company debuted Amazon Key last fall, which is powered by a home security camera and smart lock that recognize delivery personnel and lets them enter a home to deliver a package.
Beyond Nest products, Amazon also does not sell Google Home speakers or the company's Pixel smartphones, but does sell smart home products from other companies, per Business Insider. To date, Amazon has dominated the voice-controlled speaker market with its Echo devices, which were projected to hold more than 70% of the U.S. market in 2017. However, Google is quickly gaining ground by both adding new hardware products and better aligning existing ones. Google's parent company Alphabet purchased Nest in 2014 and later made the smart home products division a separate company, but Google reabsorbed Nest last month in a potential move to address Amazon's looming threat, as rejoining the two divisions ultimately allows Google to better sync its manufacturing and retail distribution.
