When Google does its holiday, or in this case, post holiday shopping, it doesn’t mess around – the tech giant has apparently laid out a substantial $3.2 billion (R32 billion) for Nest.

Google explained that Nest, which produces internet-connected smoke detectors and thermostats,  would continue to operate under the leadership of Tony Fadell and with its own distinct brand identity. In the wake of the announcement, Google’s CEO Larry Page had glowing words about the company and its founders, Tony Fadell and Matt Rogers. He enthused that the company is “already delivering amazing products you can buy right now”, crediting these with helping general users “keep their family safe.”

The CEO of Nest, Tony Fadell, was no less enthusiastic about the move: “We’re thrilled to join Google. With their support, Nest will be even better placed to build simple, thoughtful devices that make life easier at home, and that have a positive impact on the world,” he commented.

The next frontier?

It’s not just the whopping amount that raises eyebrows. Rather, it is a clear sign that Google is betting its chips on a trend known as the Internet of Things in which individual devices are always connected online and generate their own data.

Indeed, the match between Google and Fadell’s company is hardly a surprise. Google has a particular penchant for seeking out, when not developing its own, revolutionary ideas. Fadell, in his own right, is no stranger to sparking off significant innovations, largely credited for initiating the iPod within Apple, a device in itself that revolutionised music playback.

While Nest’s stated focus is on creating “a conscious home,” Google is all about managing and using big data. Putting two and two together, it appears as though for Google at least, the home, and the data generated by smart appliances, may well be the next frontier.

The transaction is subject to customary closing conditions, including the receipt of regulatory approvals in the US. It is expected to close in the next few months.