All of Dropcam's hardware is just stuff they get from OEMs in Shenzhen. They don't make it themselves, and in fact, the exact same hardware is sold by other camera vendors. But far more significant than the direct clones, there are also lots of not identical but still competing products that are just as good that go for a lot less.
The camera market is very cutthroat and low profit. Dropcam has no advantage here, not even name, because most people still haven't heard of them.
The only thing unique about Dropcam is the SaaS side but they don't do anything that could not be duplicated by others if they wanted to do it. Mostly nobody duplicates it because lots of IP camera customers just don't need that kind of service.
So what did Nest buy and why? A camera company selling generic OEM cameras you can source anywhere, or a SaaS company selling services that can be duplicated easily? It makes no sense to me.