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Alphabet overtakes Apple to become most cash-rich company

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Re: Alphabet overtakes Apple to become most cash-rich company

#91

Post by MegaButts »

sharcerer wrote: post #13
wpasc wrote: post #4

This reminds me of a talk I watched with Peter Thiel and Eric Schmidt. I know Thiel is controversial, but he was well-meaningly digging at Google for running out of ideas and no longer innovating. The criticism was something like "You have so much cash on hand but no ideas to invest in. However, you can't pay a dividend because the second you do, you're admitting you've run out of ideas and are no longer innovating".…

I think Google invests a lot. Look at CapitalG, GV etc. And now within Google itself, 2 projects which I think are aiming to become platforms: Stadia, Fuschia. Personally, I have been disappointed with Google in the AR front. Haven't heard much about investments/ acquisitions. OTOH, Apple has been acquihiring small teams, investing in microLEDs etc. Though, overall Alphabet's investments are much diverse.

You think Stadia is viable considering the lag? It's obviously worthless for competitive or even serious gamers. I am skeptical it will be enticing for casual gamers.

Re: Alphabet overtakes Apple to become most cash-rich company

#92

Post by ehsankia »

skybrian wrote: post #58
wpasc wrote: post #4

This reminds me of a talk I watched with Peter Thiel and Eric Schmidt. I know Thiel is controversial, but he was well-meaningly digging at Google for running out of ideas and no longer innovating. The criticism was something like "You have so much cash on hand but no ideas to invest in. However, you can't pay a dividend because the second you do, you're admitting you've run out of ideas and are no longer innovating".…

This argument relies on a fallacy of binary thinking: either you have ideas or you don't. It's perfectly fine to say that you have lots of investment ideas, but they don't add up to needing $100 billion to implement them. Especially when you are earning more cash every quarter.

Exactly, just because you have a lot of cash doesn't mean you should force investment into things that may not make sense. It's like if you had a huge buffet and force fed yourself until you threw up. If anything, Google probably gets flak for having too many ideas and being all over the place. People keep saying they need more focus, yet when they do that, they get accused of not having any more ideas...

Re: Alphabet overtakes Apple to become most cash-rich company

#93

Post by beefalo »

MegaButts wrote: post #91
sharcerer wrote: post #13

Earlier quoted context omitted.

I think Google invests a lot. Look at CapitalG, GV etc. And now within Google itself, 2 projects which I think are aiming to become platforms: Stadia, Fuschia. Personally, I have been disappointed with Google in the AR front. Haven't heard much about investments/ acquisitions. OTOH, Apple has been acquihiring small teams, investing in microLEDs etc. Though, overall Alphabet's investments are much diverse.

You think Stadia is viable considering the lag? It's obviously worthless for competitive or even serious gamers. I am skeptical it will be enticing for casual gamers.

I think it will be really enticing for people that want to play sports games but don't want to invest in a console. Those customers are also not going to be the ones concerned about latency.

Re: Alphabet overtakes Apple to become most cash-rich company

#94

Post by gingabriska »

ralph84 wrote: post #5
wpasc wrote: post #4

This reminds me of a talk I watched with Peter Thiel and Eric Schmidt. I know Thiel is controversial, but he was well-meaningly digging at Google for running out of ideas and no longer innovating. The criticism was something like "You have so much cash on hand but no ideas to invest in. However, you can't pay a dividend because the second you do, you're admitting you've run out of ideas and are no longer innovating".…

Once you get to Google or Apple scale, you’re essentially a government and run into the same problems with central planning that governments do. It’s absolutely the right move to return the money to shareholders and let them reallocate it to more economically promising endeavors. That doesn’t make a statement about innovation stagnation on the whole, it just reflects the reality of diminishing returns to scale.

Returning money would create inflation for acquiring future cash cows (think : firebase)

Imagine, if Google returned money then investor gets the money and now they try to invest it somewhere else, highly likely, these guys will go after companies which Google want to buy out. Why make it expensive for yourself to buy your threats?

The idea is that investment opportunities are shrinking, more money in market for limited opportunity is what creates inflation, makes it expensive for everyone to acquire new companies.

It's specially true for big tech companies where pension funds and other investment fund own large chunk of stock, if they get the money, they'll put it in venture capital or private equity which either increases cost to acquire technology (patents etc...) Or existing businesses.

Re: Alphabet overtakes Apple to become most cash-rich company

#95

Post by i_cant_speel »

MegaButts wrote: post #69
Skunkleton wrote: post #60

Earlier quoted context omitted.

> Ya, that's finance 101. But here's Finance 5400: And another point: you have to imagine that the richest companies in the world have the best possible financial expertise on staff. It is safe to assume they know what they are doing.

While I think you're probably right, a blanket assumption that "they're smarter therefore they know best" is why everyone was so surprised by what happened to Enron. I do not think this is the case with Alphabet, just saying you shouldn't blindly trust experts. There's also the subprime mortgages issue from just over 10 years ago which is much better understood now, but at the time people didn't understand them and j…

At the end of the day look where the major banks ended up after the crisis. Mostly unchanged. They knew what they were doing. It's just that what they were doing wasn't in the public's interest.

Re: Alphabet overtakes Apple to become most cash-rich company

#96

Post by ehsankia »

pyb wrote: post #45
wpasc wrote: post #4

This reminds me of a talk I watched with Peter Thiel and Eric Schmidt. I know Thiel is controversial, but he was well-meaningly digging at Google for running out of ideas and no longer innovating. The criticism was something like "You have so much cash on hand but no ideas to invest in. However, you can't pay a dividend because the second you do, you're admitting you've run out of ideas and are no longer innovating".…

It's hard not to acree with Thiel here. We only need to look at Elon Musk to realize that there are still plenty of opportunity for moonshot investments. What does Elon know that Google as a whole doesn't?

Maybe not Google, but Alphabet has a lot of far looking investments. I would argue even more varied and extreme than Elon Musk.

They have Waymo for self driving, Verily for health and biotech, remote connectivity with Loon, and many more. And let's not forget of X itself which is even more experimental and out there.

They also invest heavily in all sorts of research, such as multiple fusion projects, and competitions such as their 1m$ moon prize.

Even within Google itself, Deepmind is doing all sorts of great research. They have Duplex, Stadia, Soli, etc.

If anything, I think the issue is that they have too many things going on.

Re: Alphabet overtakes Apple to become most cash-rich company

#97

Post by docker_up »

gingabriska wrote: post #94
ralph84 wrote: post #5

Earlier quoted context omitted.

Once you get to Google or Apple scale, you’re essentially a government and run into the same problems with central planning that governments do. It’s absolutely the right move to return the money to shareholders and let them reallocate it to more economically promising endeavors. That doesn’t make a statement about innovation stagnation on the whole, it just reflects the reality of diminishing returns to scale.

Returning money would create inflation for acquiring future cash cows (think : firebase) Imagine, if Google returned money then investor gets the money and now they try to invest it somewhere else, highly likely, these guys will go after companies which Google want to buy out. Why make it expensive for yourself to buy your threats? The idea is that investment opportunities are shrinking, more money in market for limi…

Google has already created inflation from their stock price. The houses in the Bay Area have doubled in 5 years precisely because FANG engineers have had their shares skyrocket 6-10x, so they buy multiple houses.

Re: Alphabet overtakes Apple to become most cash-rich company

#98

Post by andrekandre »

johannes1234321 wrote: post #26
ergothus wrote: post #10

Earlier quoted context omitted.

> if Google thinks its company is significantly undervalued, in which case buybacks are smart Honest questions here, as my stock understanding is fairly limited: Why does a company care if it's "undervalued"? How does a buyback actually change that valuation? (doesn't the market cap remain the same after the purchase?)

Buying the stock is a way for distributing money to their share holders. Similar to a dividend.

it would be interesting if companies that size would distribute more to their employees

one fantasy calculation i do a lot is google-profits / total-google-employees or apple-profits / total-apple-employees and you get something like half a million dollars a year (60 billion dollars of profit divided by 132,000 apple employees for example)

in the above scenario, work a few years at a company like google or apple and your a millionaire basically... what would happen to the economy if suddenly there was hundreds of thousands of millionaires? how many new businesses and ventures could be started? would it in the end be good or bad economy? what about the company if it only had a few billion of liquid assets on hand instead of hundreds? would it make a difference?

Re: Alphabet overtakes Apple to become most cash-rich company

#99

Post by rpmisms »

MegaButts wrote: post #91
sharcerer wrote: post #13

Earlier quoted context omitted.

I think Google invests a lot. Look at CapitalG, GV etc. And now within Google itself, 2 projects which I think are aiming to become platforms: Stadia, Fuschia. Personally, I have been disappointed with Google in the AR front. Haven't heard much about investments/ acquisitions. OTOH, Apple has been acquihiring small teams, investing in microLEDs etc. Though, overall Alphabet's investments are much diverse.

You think Stadia is viable considering the lag? It's obviously worthless for competitive or even serious gamers. I am skeptical it will be enticing for casual gamers.

I'm going to sign up. I have a Pixel phone, I have an aging gaming laptop, and I want to continue play some new games. I'm not serious enough to be concerned by lag, and if it's awful, I'm out $129. Big deal.

Re: Alphabet overtakes Apple to become most cash-rich company

#100

Post by ehsankia »

wufufufu wrote: post #16

In StarCraft, you always want to be at 0 minerals and 0 gas because that means you are maximizing your investment into buildings and units. People make fun of you if you don't have the skill to optimize for this.

What if you suddenly unlock a unit (or maybe a shop comes selling units) that costs 1000 resources, which would take you 5m to get up to. Especially if when said unit becomes available isn't predictable, it may be a huge advantage to have some resources in reserve.

Furthermore, if you're already at the unit cap, and all your building are already working at peak efficiency, there may be no good way of spending those resources without wasting them.

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