The companies don’t plan to reinvent the wheel. They say the partnership will combine Nest’s hardware and services with ADT’s installation, service, and monitoring network. The objective is to create a more integrated home security system that can do more things.
The ADT + Google product will attempt to attract more customers by raising the bar in security systems. The goal is to offer the best technology that enhances existing home security systems.
“We are thrilled to partner with Google to provide the smart home market with a strong, differentiated product and service offering that integrates the best technology, hardware, and smart home security expertise from our two brands,” said Jim DeVries, CEO of ADT.
As part of the partnership, Google will acquire a 6.6 percent stake in ADT for $450 million in newly created Class B common stock. In addition, both firms will spend up to $150 million to promote the new product.
Available before the end of the year
The deal is expected to close later this year, and ADT plans to begin marketing the new service before the end of 2020. For Google, the deal gives the company an expanded means of marketing its Nest hardware and services.
“We’re excited to partner with ADT to further our mission of building helpful devices for the home,” said Rishi Chandra, vice president of Nest. “ADT is a leader in smart home security, and I look forward to working with the team to create innovative smart home security solutions that help everyone feel safe and protected.”
Nest Labs was founded in 2010, offering a smart, programmable thermostat. Google acquired the firm in 2014 for $3.2 billion and has added more smart home features to the platform.
ADT has a much longer history, starting as a signaling company using the telegraph in the late 19th century. It was part of both Western Union and AT&T before becoming a publicly traded company providing alarm services in the 1960s.