Can gorgeous design, learning algorithms and millions in venture capital funding make a simple home thermostat as coveted as the iPhone? If anyone can achieve such a lofty goal it’s Tony Fadell, the former chief architect at Apple, who led the development of the iPod and the first three versions of the iPhone, and who left Apple two years ago to start connected thermostat company Nest Labs.

While Palo Alto, Calif.-based Nest has been operating for about a year and a half, has 100 employees, and funding from Kleiner Perkins, Google Ventures and Al Gore’s investment fund, it just came out of stealth on Tuesday to reveal its smart thermostat design and energy efficiency ambitions. Nest says the thermostat is the first “learning thermostat” in the world. It will be available for $250 in mid-November, and can save 20 to 30 percent in a home’s energy consumption.

The idea behind Nest

Fadell explained to me in an interview that he and his wife (who led human resources for Apple) decided to leave Apple about two years ago to spend more time with their young children, and basically retire. But you know how that goes for the ambitious, young, Silicon Valley types. While designing a green home in Tahoe, Calif., Fadell became hung up on the lack of options for a thermostat for the home — they were expensive, not smart, ugly, and basically “crap” says Fadell. And like all good entrepreneurs he thought to himself: there’s got to be a better way.

That option ended up being getting back on the Valley treadmill, and creating one of the most ambitious greentech ventures I’ve seen to date. Nest has raised tens of millions of dollars (they wouldn’t disclose the amount) from high profile venture capitalists including Kleiner Perkins Caufield & Byers, Google Ventures, Al Gore’s investment group Generation Capital, and Shasta Ventures.

While other companies are targeting the smart thermostat market (see my article on The next home energy battleground: the smart thermostat) like Opower and Honeywell, Radio Thermostat Company of America and EnergyHub, and EcoFactor, Nest is the first company that has created an end-to-end smart thermostat service, which offers the software, a gadget and a data-filled website. Fadell tells me that everything that the consumer touches has been designed by Nest.

That’s why it has 100 people and have raised a lot of money. The team building the learning algorithms includes Yoky Matsuoka, the former head of innovation at Google, and machine learning expert while Stanford Professor Sebastrian Thrun is an advisor to the company.

How Nest works

What will stand out most to energy nerds like me that look at a lot of thermostats, is the unique design of Nest. The thermostat’s form is a simple circle, with a ring on the outside and a single button, that controls the entire interface. Like the iPod and iPhone, Fadell wanted to make the device intuitive and simple to use and he says for the Nest system to work “it needed to be a coveted, cherished object that sits on your wall.”

In contrast, a major problem with most thermostats is that only two out of five are programmable and of those that are programmable, only 6 percent are actually programmed by the owners, says Fadell. Most thermostats are confusing, boring, or just not smart enough to keep the home owner’s attention.

The Nest thermostat, on the other hand, is supposed to learn your energy consumption behavior and program itself, and then automatically help you save energy in a convenient way. Once installed, the thermostat takes about a week of hardcore learning to recognize the standard way you heat or cool your home, and then recommends settings that are slightly more efficient than what you already do. It also automatically turns down the thermostat at times that are convenient to you. The device also continues to do lighter learning of your behavior via pattern recognition and your manual interaction with it, throughout the life of the device.

The recommendations and energy efficient mode appear to the Nest user as a leaf on the interface, giving direct feedback on energy choices. But the automatic control of heating and cooling will likely have a bigger impact on energy use. The Nest thermostat has five sensors — temperature, humidity, light and two activity sensors — and the activity sensors can notify the device to turn down the heating and cooling when no one is in the house.

The Nest thermostat also has a feature called “time to temperature,” which shows the home owner how long it will take to heat or cool the home. Say, you set the thermostat for 75 degrees, the Nest interface could read, 75 degrees in 25 minutes, letting you know how long it will take. The idea behind that feature is that most people set a thermostat like an accelerator, says Fadell, increasing the temperature or cooling way above or below the actual desired setting. But giving the user more feedback can help curb this problem — think of it like seeing how long a download of a file will take.

In addition to the thermostat device itself, Nest has created mobile apps and a website to be able to remotely turn up or down the thermostat, and also to give far more detailed data about home energy use. For example, you can log into the Nest website and see how much money you’ve saved, how many times you’ve turned up or down your thermostat.

The smart grid and Nest

The Nest thermostat also has Zigbee and Wi-Fi chips, so that it can connect with both your home broadband connection, and also other Zigbee devices like a smart meter, or smart appliances. Fadell says that thermostats are installed only every decade or so, so when the smart grid is fully deployed he wants the Nest thermostat to be ready.

Other companies like Opower and Honeywell are using a smarter thermostat as a way to connect with and control the smart energy home. While a lot of companies have focused on fancy dashboards that can monitor and control a home’s energy consumption, these devices haven’t really caught on, and smarter thermostats seem to be a better way in.

However, Nest is one of the only companies that is directly targeting consumers for its thermostat. Nest plans to sell its thermostat at Best Buy, via building specialty channels, and through its website. Fadell tells me the company wants to “connect with the iPhone generation where it shops.”

But at the same time that Nest is going direct to consumer, the device will clearly have a utility play, which the company is being quiet on right now. Like EcoFactor’s smart thermostat service, I could imagine utilities could work with homes that have Nest installed, to collectively curb energy consumption during peak grid events. This type of service is called demand response, and the saved energy per household helps utilities manage their grids during really hot summer days. Since the device also has ZigBee installed it could potentially connect with utilities’ smart meters, too.

Nest says that home owners can save 20 to 30 percent on their energy bills, which is one of the highest estimated ways to curb home energy use on the market. In contrast, mailed detailed energy bills from Opower are helping home owners cut around 2 percent. EcoFactor says with its similar thermostat service (but no designed gadget) it can get home owners to cut their energy consumption by 17 percent. If Nest actually takes off, utilities will be interested in working with that double digit energy reduction, though I’d like to see that 20 to 30 percent reduction validated in larger real world customer deployments.

My impressions

I think Nest is one of the more ambitious, and cool, ideas I’ve seen in the greentech space. The Nest thermostat is also beautiful and the idea is game changing on its own. However, I’m not so convinced it will work (I want it to! Prove me wrong!). I just don’t know if people will spend $250 on a thermostat, particularly in this economy. You can buy a connected, digital, programmable thermostat for $50, and $100 on the high end.

Also while Nest includes detailed instructions on how to install the thermostat (including a Nest screwdriver), installing a thermostat is actually kind of confusing. I’ve tried to tinker with some of the newer connected thermostats, and usually I end up wishing I hadn’t tried to do this myself — it involves circuit breakers and electrical wiring. Nest says it will offer Nest-approved installers, if people don’t want to install it themselves. Maybe the Best Buy Geek Squad will be able to help with this.

At the end of the day, it will take an army of Nest-inspired early adopters to convince the rest of the country and world to adopt Nest. Silicon Valley will probably rave about it, as they should, but will the other 99 percent of the country get on board with a $250, do-gooder, smart thermostat that’s as pretty as the iPhone?

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I like both Adobe (Lightroom rocks!) and Apple (iPad rocks!), but I’ve been asked over and over again what I think about Apple’s new 3.3.1 policy. You know, the one that basically bans cross-platform development frameworks. And, in particular, basically nails the Flash coffin shut on iPhone/iPod/iPad. So, what do I think?

I love it.

And I’m surprised more developers, end users, business leaders, and general web standards lovers everywhere aren’t posting about how great this is.

It’s good for end users.

The App Store already has a signal-to-noise problem. With hundreds of thousands of apps, finding the good stuff is tough. Bear in mind that every single one of those Apps was built by someone intentionally designing for these devices – and we’ve still got plenty of junk in amongst the gems. Now imagine a bunch of developers just cross-publishing to lots of devices – ignoring all of the strengths of each of those devices. The signal to noise ratio gets worse, fast. Ugh.

It’s good for the web.

For me, this one is the biggie. These devices are a dual-platform: iPhone SDK and HTML. Don’t like the iPhone SDK? Build for HTML. And finally, finally, someone has stepped up and done something about the de-facto Flash monopoly. Flash has helped the web and HTML standards to stagnate. It’s sorta like a drug. It’s whizzy and slick, granted. But it’s a nightmare, too. Flash crashes constantly. Its performance is terrible (when a 1Ghz mobile processor in the iPad plays video more smoothly than Flash on a 16-core Mac Pro with a hefty GPU, that’s a problem). And it smashes through web paradigms left and right. Why? Because there’s no competition.

Look at the browser world, on the other hand. With Microsoft, Mozilla, Google, and Apple duking it out, we’re seeing a breathtaking pace of innovation. Browser stability and performance is improving at an astonishing rate. There’s no reason Flash shouldn’t be super-stable and fast by now – but it isn’t. It’s like the Internet Explorer doldrums all over again – Flash is holding us back, just like IE used to. I’d rather be building for something with a scary fast pace of innovation than something stale.

The iPad is already spurring HTML5 adoption even faster than before. Witness all the video and games sites that are already scrambling to announce and ship their HTML5 interfaces. Bring it on!

I want to build for the web, not for Flash.

It’s good for developers.

And by that, I mean “good developers.”

Good developers are language agnostic. They’ll write in whatever language is worth the effort.

Good developers love great toolsets and great platforms. The iPhone SDK is amazing.

Good developers want their creations to be perfectly tuned to their purpose. The iPhone/iPod/iPad interfaces demand and deserve lots of individual attention, not to be marginalized by some middleware cross-platform publisher.

Good developers want their products found and used. The App Store signal-to-noise issue is a daunting one – more shovelware won’t help.

Good developers want a stable community, with lots of advice, sample code, libraries, etc. A fragmented development landscape prohibits that – a unified one encourages it.

I could go on – you get the point. Best of all? It weeds out poor developers. And if the iPhone SDK and HTML5 aren’t your thing – go build somewhere else. I’m sure there’ll be another computing revolution in a decade or two that you can ignore yet again.

(and if you’re a good developer – we’re hiring and we’re having more fun than you can possibly imagine)

It’s good for Apple.

They get better apps. Happier end users. More productive good developers. Fewer bad developers. And, of course, they make more money. They did invent the software, devices, and App Store, afterall. Why should they marginalize themselves out of their own business?

It’s even good for Adobe

Granted, not quite as good for Adobe as having Flash on these devices. But lets not forget that Adobe has a stable of great applications, like Illustrator and Photoshop, which aid iPhone development. Their sales will still boom.

Finally, Adobe is incentivized, finally, to actually improve Flash. I’ll bet if Adobe actually made Flash stable, fast, and power efficient, it could get added to the iPhone for use in-browser. It’s not like Apple enjoys seeing half rendered web pages in their browser – they just enjoy customer complaints about crashing and poor performance less. Believe me – I know all about customer complaints due to poor Flash behavior.

But that window of opportunity is closing – the owners of those web pages don’t enjoy their stuff being half-rendered either. They’ll rush to fix that problem – without Flash – if Adobe doesn’t fix it for them.

So there you have it. Thanks, Apple, for doing what’s best for the web, your customers, and developers like me. The future is bright. Long live web standards!

(this post written on an iPad in WordPress’ excellent app)

UPDATE #1:

I understand many disagree, and have their own reasons. Go write for Android, another great platform that’s more open.  Maybe if you do, Android will ‘win’.  I think you’re confusing platform choice and development choice here.  Personally, I’d love to have more platform choice.  Who wouldn’t?  But Apple did invent this thing.  They certainly deserve to make whatever decisions they want about it.  If you’re right, and I’m wrong, those decisions will kill the platform.    I happen to think I’m right, and I happen to think Flash needs to seriously improve – and the Apple’s the only way that’s gonna happen.

Note that I don’t have an opinion on things like MonoTouch, which I know nothing about.  It could very well be that Apple painted with too wide of a brush here and excluded some things that should really be included.  I just don’t know.  I do know, though, that history has shown that cross-platform languages and frameworks have an abysmal success rate.  The last thing we need is watered down apps built for the lowest common denominator.

Finally, yes, SmugMug uses Flash.  I’m sure we’ll continue to use it.  Like I said, it’s slick and whizzy and like a drug.  We used it because it was the only tool for the job.  Adobe did a great thing with their h.264 support, and we love our Flash apps – when they work.  But it’s been awfully frustrating to watch Flash continue to crash and perform poorly for our customers, especially because Adobe doesn’t seem to care.  They certainly don’t respond to us when we ask for help, and they certainly haven’t fixed their issues with multiple releases.  I’m hopeful that this sudden pressure and increased competition will cause them to bring Flash up to the level of their other superb products like Lightroom.  If not, you’ll certainly see us move away from Flash as HTML5 support and performance continues to improve, just like everyone else on the web.  We can play Quake II in HTML5, for heaven’s sake!

UPDATE #2:

Steve Jobs on Adobe.  Amen, brother.

Not too long ago, David Findlay built a device capable of communicating with just about any model of iPod via the dock connector using an Arduino Nano, PodGizmo breakout board, an old USB iPod connector, and a momentary switch. While it may not sound like a big deal, there is more to it than one might think: namely programming a device (in this case the Arduino Nano) to be able to receive, interpret, and respond to messages sent from an iPod. 
This means teaching it to speak Apple Accessory Protocol and, although proprietary in nature, it has been fairly well documented around the Internet. Finland slung some code so that his iPod touch was hooked up to one of the famous Staples Easy buttons in his car. Now he could easily play and pause his iPod touch without having to fiddle with the on-screen controls.

Fast-forward several months and  Findlay had all but forgotten about the project when he was asked by the folks that run Make magazine to talk about it. In particular, they wanted him to talk about the library he created for communicating with Apple’s portable audio players. He said yes, and decided to dive back into the project and attempt to add additional functionality to the project. 
Finland's first go around only involved tackling the the Simple Remote portion of the Apple Remote Protocol, which handles things like mute, next playlist, skip, and turning the device on and off. With newfound interest, however, he has now tackled the Advanced Remote portion, which opens up a bevy of new functionality, including getting names of songs, albums, artists, and track time; toggling shuffle and repeat mode; and all the other neat functionality that iPods have.

This newly released library of code will surely appeal to the do-it-yourself hackers who love tinkering, soldering, and programming. Someone could theoretically even build his or her own iPod speaker solution with a plethora of different options and feedback. The more daring could hard-wire a solution to a car’s in-wheel audio controls. Personally, I envision some sort of bicycle solution that docks the iPod on the handlebars but allows riders to control the device without taking their hands off the handlebars. An even more enterprising individual could rig something like this up to a sudden motion sensor so that when someone enters a room, the iPod begins to play.



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