The company came out of stealth mode today, telling the story of how two consumer electronics mavens, including the "father of the iPod," decided to take on an unlikely quest of making a better thermostat.

The product is just a programmable thermostat. But the genius of Nest Labs is that it decided to make the iPhone of thermostats--a device that looks cool and is smart enough to spare the owner the frustrations of unfriendly technology.

Instead of pulling out an owner's manual, people simply use the Learning Thermostat by turning a familiar dial to change the temperature. After a few days, or a week at most, it will know the household schedule and create a suitable program.

"There are no great consumer products in this area," said co-founder and vice president of engineering Matt Rogers. "There's an entire generation of folks used to beautiful, intuitive products that are easy to easy and you don't have to go out of your way to work with."

The humble programmable thermostat is certainly not something most people get excited about. But the impact is big: the EPA estimates that households can cut energy by 20 percent to 30 percent simply by having a set schedule. And heating and cooling is almost half of household energy use, about $1,000 a year in the U.S.

The Learning Thermostat can be networked via WiFi, so people can program them from an iOS or Android device. If you have multiple thermostats, they can be controlled as a group since they're networked.

But the power of the device is the software, the artificial intelligence which can improve home efficiency automatically and the user interface to effectively communicate with the user. The display tells people how long it will take for the house to reach a temperature and shows a leaf to signify they're doing well in being efficient. That's a big step up from today's clunky white boxes. It's no wonder only a small fraction of today's programmable thermostats are actually programmed.

Whether the $250 Learning Thermostat or subsequent products from Nest Labs are a hit with consumers remains to be seen. But the company has already done something important by bringing Silicon Valley's best traits from consumer technology to home energy.

Until now, the bulk of green technology companies have been dominated by material scientists, people who had a better idea for a solar cell or rechargeable battery. The target for many green technologies, even electric vehicles to a degree, are big businesses and utilities.

Certainly, that's vital to innovation in energy. What has lacked, though, are products consumers can actually touch and help them concretely relate to their personal energy use. In the mid 1990s, everybody knew the Internet was a big deal but it wasn't until the Web browser came along that everyday people could actually get online.

Nest Labs is not alone in trying to make high-tech consumer energy products or even better thermostats. EcoFactor, for example, uses cloud computing to improve the performance of programmable thermostats and consumer smart grid companies Tendril and EnergyHub are taking a similar approach. And there are dozens of business ideas around the notion of the "Clean Web," or consumer apps geared toward conserving natural resources.

Where Nest Labs can stand out is by making an object of desire, a gadget that's highly functional and fun to own. The company isn't talking about its future product plans, but with 100 employees and funding from top venture capitalists, it shouldn't be going away soon.

Significantly, the Learning Thermostat, which runs its own operating system, can be software updated with new features over time, such as connecting to utility demand response programs. It will be sold at familiar retail outlets, such as Best Buy and perhaps hardware stores.

The founders and employees are driven in part by the same impulse to make a positive social impact as many other green-technology entrepreneurs. At the end of the day, consumer electronics such as the iPod and iPad are "landfill," said Rogers to explain why he left Apple.

The area of energy efficiency is famously unsexy, yet delivers the biggest bang for the buck. So far, Nest Labs has the best chance of making it more interesting and mainstream.

"We're bringing design, great technology, and artificial intelligence learning to the most unsexy industry possible," Rogers said. "It's very exciting to all of us."

By: DocMemory
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