The future of the smart home market is as murky as Nest's own future. Even after Google acquired Nest in 2014, it has not followed up on its success with connected thermostats and smoke detectors, writes Fortune staffer Stacey Higginbotham.

After the deal was announced, the VC world went mad searching for investments, while larger companies searched for potential acquisition targets. At industry events that year, everyone I ran into with a connected product or a KickStarter was in talks to sell out or score more funds.

But two years later, the reality has set in as entrepreneurs in the space are dealing with a skeptical customer base and the challenges of seeing their grand vision for a connected home get mired in rival standards. Meanwhile, economic concerns are leading tech companies to prepare for everything from a nuclear winter to a mild recession.

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