Google Buying Thermostats Heats Up Deal Talk: Real M&A

Google Inc.’s $3.2 billion purchase of a digital thermostat maker may jump-start a multibillion-dollar race to acquire companies that are powering the rise of Web-connected devices across homes, cities and workplaces.

After Google agreed to buy Nest Labs Inc. this month, competitors such as Microsoft Corp. also may be looking to snap up companies with the technology and patents for smart devices, said Recon Analytics LLC. The market for the so-called Internet of Things -- which ranges from Web-enabled home appliances to centrally linked industrial equipment -- is estimated to generate $8.9 trillion in revenue by 2020, up from $4.8 trillion in 2012, according to researcher IDC.