G is for Google • Hacker News Board

Re: G is for Google

#381

Post by anjc » Tue, Aug 11, 2015, 12:54 AM UTC

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.

Google could go public though, right? (The new Google)

Re: G is for Google

#382

Post by dotori » Tue, Aug 11, 2015, 12:55 AM UTC

Alphabet (the main company)

B

Calico (focused on longevity)

Capital (investment)

D

E

Fiber

Google (now led by Sundar Pichai and includes search, ads, maps, apps, YouTube, and Android)

H

I

J

K

Life Sciences ("that works on the glucose-sensing contact lens")

M

Nest

O

P

Q

R

S

T

U

Ventures (investment)

W

X lab ("which incubates new efforts like Wing, our drone delivery effort")

Y

Z

Re: G is for Google

#383

Post by trhway » Tue, Aug 11, 2015, 1:01 AM UTC

S4M wrote: post #296

vonmoltke wrote: post #290

Earlier quoted context omitted.

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.

i guess the employees will now also get a clear feel who of them is "maker" and who is "taker" :)

By the way - who is inheriting the piles of money accumulated in the tax heavens? I think that is another elephant in the room. The GoogleX+Fiber+... is obviously a money hungry black hole, so would they be able now to redirect/invest this money from abroad straight into hat loss generating business without incurring the taxes?

Re: G is for Google

#384

Post by fredkbloggs » Tue, Aug 11, 2015, 1:01 AM UTC

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…

Well, yes, but Sun was more than the sum of its parts. Alphabet is actually less than the sum of its; Google is a highly profitable ad business that's still showing nice growth. The rest is a hodge-podge of startups and fantasies that provide neither revenue nor profit and have little chance of ever doing so. Most of them don't even have products. There's no reason to think that what is being taken out of Google was helping its business in any way, yet the market right now is willing to pay big option premiums on the remote chance of some future success. So what is now Alphabet would be worth more if Google were spun out entirely to its existing shareholders, because they'd get whatever Google is plus whatever people are willing to pay for the imaginary stuff. As a whole, it's just Google less a lot of its profits. None of this was true of Sun.

Re: G is for Google

#385

Post by endergen » Tue, Aug 11, 2015, 1:01 AM UTC

This is just some razzle dazzle to make it less jarring that Google's founders want to focus on their hobbies and not run Google proper.

Re: G is for Google

#386

Post by anjc » Tue, Aug 11, 2015, 1:01 AM UTC

001sky wrote: post #371

vonmoltke wrote: post #290

Earlier quoted context omitted.

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

While you are right in your comment, in so far as what you have written, the implication that [this] "reorganization makes no difference on the financials" is not strictly speaking true. Going forward, this re-organization may very well allow capital allocation to be done at various legal entities a-la project or structured finance. That way, the risk/return of the various projects can be traded on more efficiently t…

> That way, the risk/return of the various projects can be traded on more efficiently to the benefit of both investors and google/alphabet shareholders.

How would this make any difference for the costing of projects (or businesses, now)? In terms of risks and returns. Its not like new businesses under Alphabet will be boostrapped, they'll still be the same drain/boon on resources that they always were.

Re: G is for Google

#387

Post by amlgsmsn » Tue, Aug 11, 2015, 1:02 AM UTC

snowwrestler wrote: post #366

minot wrote: post #336

Earlier quoted context omitted.

Joel Spolsky's Strategy Letter V is something that I think is interesting in this Sun conversation > Sun is the loose cannon of the computer industry. Unable to see past their raging fear and loathing of Microsoft, they adopt strategies based on anger rather than self-interest. Sun's two strategies are (a) make software a commodity by promoting and developing free software (Star Office, Linux, Apache, Gnome, etc), an…

Joel has always seen things from Microsoft's point of view. And we are actually living in the world he mocked: both hardware and software, on the server side, have been largely commoditized.

He didn't mock the world, he mocked Sun's strategy and it played out exactly like he said causing Sun to die off.

Re: G is for Google

#388

Post by rodgerd » Tue, Aug 11, 2015, 1:06 AM UTC

Retra wrote: post #303

bcantrill wrote: post #267

Earlier quoted context omitted.

That was definitely true at Sun as well. At one point, Arthur van Hoff told me with a straight face that "every E10K Sun sold was because of Java." This was in early 1998 -- and it was categorically (and demonstrably!) false. We at Sun who had the filthy task of actually making money were looked down upon by those who were responsible for spending it -- and represented one of the ultimate failures of the planet model…

I can't see why anyone would object to that kind of arrangement. The whole reason we do the boring stuff is because it pays for the exciting stuff. If exciting stuff could pay for itself, nobody would ever do anything dull.

If the dull stuff compensated for the lack of prestige with cash (for example), that might be true. But in reality, the low prestige tends to go with low pay, low promotion opportunities, and low recognition.

Re: G is for Google

#389

Post by ewang1 » Tue, Aug 11, 2015, 1:06 AM UTC

xasos wrote: post #270

Wow, didn't know this was so popular overseas as well: https://en.wikipedia.org/wiki/Chaebol i.e. Japan Display Inc. is a conglomerate that encompasses the LCD businesses of Sony, Toshiba, and Hitachi

Chaebols are in a league of their own.

Re: G is for Google

#390

Post by fredkbloggs » Tue, Aug 11, 2015, 1:14 AM UTC

josh2600 wrote: post #252

return0 wrote: post #224

Earlier quoted context omitted.

Isn't 96% of Google profits from search ads only? They 've done a million ventures since then, still remain ad-funded.

Current sources of value != future sources of value. The price of Google's stock is based on forward-looking prospects, not on current metrics.

Actually, the price of Google's stock is based on expectations of future demand for Google's stock. It has little or nothing to do with the expectations of profits or the ability of the shareholders to receive them. This is true of all listed companies, and the more liquid their shares, the more true it is.