Alphabet's Nest Working on Cheaper Thermostat, Home Security System

Nest, the pioneer of the iPhone-like digital thermostat, is readying several new products in its quest to modernize the home.

A Nest Labs Inc. thermostat is displayed during an event in San Francisco, California, U.S., on Wednesday, June 17, 2015.

Photographer: David Paul Morris/Bloomberg

Alphabet Inc.'s Nest, seeking a bigger share of the connected home market, is developing a cheaper version of its flagship thermostat and new home security products, according to a person familiar with the matter. 

The company is working on a version of its "learning thermostat," which adjusts the temperature based on usage patterns, that would sell for under $200, the person said. The current version sells for $249. The cheaper model would include less expensive components and at least one internal prototype lacks the flagship model's metal edges, the person said. 

A home-security alarm system, a digital doorbell and an updated indoor security camera are also in the works, representing potential good news for a company that has struggled to release many new products. 

Co-founded by Tony Fadell, a former Apple Inc. executive who helped create the iPod, Nest was acquired by Google for $3.2 billion in 2014 after the first version of its thermostat sold well. Fadell left last year after some employees complained publicly about his aggressive management style. The business is now run by Marwan Fawaz, a former executive vice president of Motorola Mobility. 

The new, cheaper thermostat may launch by next year, the person said. Nest is also developing remote sensors for its thermostat that would let users control the temperature of individual rooms versus just the entire home.

A spokesperson for Palo Alto, California-based Nest declined to comment on future products. Hardware product roadmaps are often in flux and may change.

Nest is also working on an end-to-end home security alarm solution with the goal of shipping this year, the person said. One of the prototype versions of the system includes a central hub with a keypad, a pack of alarm sensors to be placed on windows and doors, and a fob for key rings for arming and disarming the alarm system, the person said.

Like a standard home alarm system, the alarm will ring when a person enters the room until the correct code is entered into the keypad. The fob could also be used to enable and disable the alarm, according to the person. The security system would be paired with a smartphone application that would allow a home owner to approve entry for a specific person, such as a dog walker or visitor, the person said. The Information reported on an upcoming Nest security system last year. 

Nest is also developing a second-generation version of its indoor security camera. Originally launched last year with technology obtained with the acquisition of startup Dropcam, the security camera can currently determine when a person walks into a room and notify a user via a mobile app. The new camera may be released as soon as this fall, the person said. Nest has internally discussed enhancements to the indoor camera for identifying specific people in the frame, the person added. 

The company is also exploring the development of a digital doorbell system for release as soon as next year, the person said. The digital doorbell would include a video camera and integrate with an app so that a resident could theoretically communicate visually with a person before opening the door.