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G is for Google

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Re: G is for Google

#291

Post by boredguy8 »

tptacek wrote: post #37
jordigg wrote: post #5

So all google divisions are now individual companies inside a conglomerated called Alphabet where Larry is the CEO and Sergei the President. Sundar Pichai is now the new CEO of Google. Is that right? Why do you think they are moving this way? Regulations? Taxes? What about Eric Schmidt? I don't know much about trading, but look at that "after hours" spike! http://postimg.org/image/ho5ecyr99/ EDIT: All google subsidia…

I didn't read it that way. All of Google's subsidiaries are subsidiaries of Alphabet, as is Google. But divisions inside of Google (Android, Youtube, &c) remain Google. The big news is that Larry and Sergey are stepping back into a more Warren and Charlie kind of role, and Sundar Pichai is taking over as CEO of Google. My question is, what does "slimmed down" Google mean?

Remember the "more wood behind fewer arrows"? That's slim Google. Alphabet is Larry & Sergey missing the more arrows.

Re: G is for Google

#292

Post by jsnell »

ChuckMcM wrote: post #133

Wow, they are doing letters? Really? Letters? Hey is Eric Schmidt still in the building somewhere? Ask him how well Planets worked out for Sun Microsystems. Interesting strategy, hard to second guess from the outside of course. Sun's motivation was to figure out whether the other parts of the company could stand on their own[1], it also makes it less fiscally complicated to discharge an entire group into the void. Th…

I don't think it's quite comparable though. This is chopping off companies with essentially no synergies with the core business, which are kept in a single monolithic entity. If anything the association is often negative, with the assumption that the only reason Google owns a business (e.g. Nest, Fiber) is to hoover up people's private information.

Now, there would be insane ways of splitting the company. Say putting building and operating data centers into a separate company from the company using the data centers to run services. Or splitting Android or Chrome into a separate company that'd then be funded by selling the default search engine setting to the highest bidder. If that kind of thing happens, it'd be women and children first into the lifeboats.

Re: G is for Google

#293

Post by franciscomello »

Here's why I think Google's transformation into Alphabet was not a wise one.

As Google cofounder Larry Page, now CEO of the holding company Alphabet, that will have as its main subsidiary Google, the search company, said earlier today:

>As Sergey and I wrote in the original founders letter 11 years ago, “Google is not a conventional company. We do not intend to become one.” As part of that, we also said that you could expect us to make “smaller bets in areas that might seem very speculative or even strange when compared to our current businesses.” From the start, we’ve always strived to do more, and to do important and meaningful things with the resources we have.

Well, if Google wants to keep spending investor money into "speculative" areas, what could be dumber than reporting its financials as "Google: hugely profitable" and "other random stuff: huge cash drain"? It will just make investors all the more sensitive to the fact that Google's search business is basically what makes money, and everything else is - for now, at least - a huge cash drain.

Raising awareness to Google's - oops, Alphabet's - business unit's individual financials will attract attention of the likes of Carl Icahn, who's raided Ebay in the past, and who'll engage in open challenging of Page and Brin's capital allocation decisions. It will definitely not compensate for the advantages of having Sundar Pichai take on greater responsibilities as Google chief, etc.

Not at all a wise move.

Re: G is for Google

#294

Post by arihant »

Spooky23 wrote: post #281
yRetsyM wrote: post #266

Earlier quoted context omitted.

I find it also interesting the non - Google companies: Businesses such as Calico, Nest, and Fiber, as well as its investing arms, such as Google Ventures and Google Capital, and incubator projects, such as Google X, will be managed separately from the Google business. Fiber is the most notable to me - seems they see this as more than an experiment and are looking to expand. YouTube not separating is an interesting on…

Fiber is the hint about what this really means. Capital intense businesses like ISPs or car companies are expensive to operate and the financials would drag down Google. In this model, the big shareholders get to dilute risks in these ventures, while retaining the ability to exponentially increase their personal wealth.

I don't think there would be a difference on financials. Alphabet is worth exactly as the old Google, and is currently operating exact same businesses.

Separating Fiber is important for other reasons, most notably, saving themselves from conflict of interest/anti-trust lawsuits.

Re: G is for Google

#296

Post by S4M »

vonmoltke wrote: post #290
Spooky23 wrote: post #281

Earlier quoted context omitted.

Fiber is the hint about what this really means. Capital intense businesses like ISPs or car companies are expensive to operate and the financials would drag down Google. In this model, the big shareholders get to dilute risks in these ventures, while retaining the ability to exponentially increase their personal wealth.

This reorganization makes no difference on the financials. The release explicitly stated the company is trading at the conglomerate level.

Yes, I guess the ones that are getting affected are the Google (not Alphabet) employees, since now it must be much more complicated for an engineer working on a Google project to be transferred to something more sexy such as the Self Driving Car. Disclaimer: I don't work at Google and don't know anybody who does, so I might be totally off.

Re: G is for Google

#297

Post by coldtea »

noelsusman wrote: post #164
coldtea wrote: post #103

Earlier quoted context omitted.

Yes, they sell decently, but do no represent any profit for Google (which gives the OS for free). It's around 5-6 million units sold anually, but, as Google themselves said, Google don't make any money of off them. Samsung, Acer, etc, who produce the units do, but again, in total it represents a tiny slither of laptop profits due to the small margins. Most Chromebooks (70%) go to the education market as cheapo laptop…

If direct profit generation is the measure of failure for Google then they've failed at basically everything except for advertising.

Even taking indirect advertising profit into question, they've failed at basically everything.

E.g. with all the billions developing Android, buying Motorola etc, they still make the large majority of mobile ad money on iOS devices!

Re: G is for Google

#299

Post by aylons »

igorgue wrote: post #212
aylons wrote: post #26

Earlier quoted context omitted.

They are not consumer-facing, so this would not matter.

Yeah, like PG is ever wrong! These people man... I swear.

Not even that. Really, I just pointed that this is not a problem that presents itself in this case. You really want to compare a startup to a holding?

Re: G is for Google

#300

Post by smohnot »

Fun game: Name Google products A-Z without looking them up! Here's what I got: Android, Blogger, Chrome, Drive, Earth, Finance, Google, Hangouts, Inbox, Jaiku, Keep, Local, Maps, Now, Offers, Picasa, Questions, Reader (RIP), Search, Translate, U??, Voice, Waze, X Labs, Youtube, Zagat... I couldn't think of anything for U and Jaiku was a bit of a stretch
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