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Alphabet Loses $859M on 'Moonshots' in 2Q 2016

nytimes.com

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Re: Alphabet Loses $859M on 'Moonshots' in 2Q 2016

#61

Post by frakr »

askafriend wrote: post #2

I don't see anything wrong with this approach, especially since the company can actually sustainably afford to keep placing these bets. And perhaps "bet" is the wrong word being used here. Usually with a bet in gambling terms, you either win big or you lose it all. When Alphabet tries a "moonshot", they come away learning a lot about whatever problem it is that they were trying to tackle. They build expertise in-hous…

I think that it would be reasonable to assume that many of these moonshots are generating patents that could have significant long term value.

Re: Alphabet Loses $859M on 'Moonshots' in 2Q 2016

#62

Post by zaroth »

ipsum2 wrote: post #41
askafriend wrote: post #2

I don't see anything wrong with this approach, especially since the company can actually sustainably afford to keep placing these bets. And perhaps "bet" is the wrong word being used here. Usually with a bet in gambling terms, you either win big or you lose it all. When Alphabet tries a "moonshot", they come away learning a lot about whatever problem it is that they were trying to tackle. They build expertise in-hous…

> And perhaps "bet" is the wrong word being used here. Usually with a bet in gambling terms, you either win big or you lose it all. Internally, they're referred to as 'bets, a pun on the company name Alphabet.

Aww, isn't that cute.

Re: Alphabet Loses $859M on 'Moonshots' in 2Q 2016

#63

Post by tjl »

w1ntermute wrote: post #5

There was an HN discussion earlier this week on Google X[0]. One important point made there, by snarf: > Google X is mainly about the PR value around its image and recruiting/locking up talent. Google would rather have smart people locked up inside the company working on projects with a high probability of going nowhere rather than having them going to a competitor, or worse, creating the next major competitor. 0: ht…

There's a number of projects as part of Google X that have little to do with any of Google's core businesses. They don't really need engineers specializing in fluid mechanics outside of Google X. I interviewed for a mechanical engineering Google X position a few years back. I note that the project I interviewed for still hasn't come out of their lab yet.

Re: Alphabet Loses $859M on 'Moonshots' in 2Q 2016

#64

Post by sudhirj »

A lot of times I feel like the instinctive reaction to the word losses is an image of Google stacking up a millions of dollars and burning it. That's not what happened - it went to people who used it to build things that would not have been built otherwise, in the hope that some of them might shape the future. Not really a loss to humanity.

Re: Alphabet Loses $859M on 'Moonshots' in 2Q 2016

#65

Post by e15ctr0n »

aresant wrote: post #27

This article makes it sound like Google frittered away $1b on the "X" lab last quarter. X lab includes self driving car, Goog Glass, Project Tango (editorializing here but Tango is badass!), more crazier bets (1) Ok, some crazy stuff there - pretty pretty risky. Wow $1b last quarter for that stuff. Geez corporate responsibility grumble grumble, stupid silicon valley assholes snark snark. But wait, spend 30 seconds do…

> So come on NYT spend 5 mins getting the story straight instead of writing a lazy click bait headline.

Actually, NYT has syndicated an article originally written by a reporter of the Associated Press. It says so right at the top.

http://hosted2.ap.org/APDEFAULT/495d344a0d10421e9baa8ee77029...

Re: Alphabet Loses $859M on 'Moonshots' in 2Q 2016

#66

Post by ktRolster »

zaroth wrote: post #33

I don't think it's right to equate R&D spending with "losses". Google makes a profit, not a loss, so technically it does not have losses. It has expenses, and among those, investments in future technology. If all Google could do with their cash flow was pay a dividend, that would be very sad, and it would call for a much lower P/E ratio. This article completely misstates the facts. Perhaps the way they break out thei…

  >I don't think it's right to equate R&D spending with "losses"
Especially since they are still working on them. Can't really call them a loss if it turns into billions in the next few years.

Better to say "Alphabet spent $859M on...."

Re: Alphabet Loses $859M on 'Moonshots' in 2Q 2016

#67

Post by jahnu »

zaroth wrote: post #33

I don't think it's right to equate R&D spending with "losses". Google makes a profit, not a loss, so technically it does not have losses. It has expenses, and among those, investments in future technology. If all Google could do with their cash flow was pay a dividend, that would be very sad, and it would call for a much lower P/E ratio. This article completely misstates the facts. Perhaps the way they break out thei…

Playing devil's advocate here (a little) but imagine they took a few dozen million of that and, say, improved their development tool chains for Android (which are disappointingly flaky). Or another few dozen millions and extended the security updates for Nexus phones by a couple of years. That could grow their market share of both developer mind-share and consumers.

Moonshots maybe should come once you've mastered all your core products?

Re: Alphabet Loses $859M on 'Moonshots' in 2Q 2016

#68

Post by dredmorbius »

w1ntermute wrote: post #5

There was an HN discussion earlier this week on Google X[0]. One important point made there, by snarf: > Google X is mainly about the PR value around its image and recruiting/locking up talent. Google would rather have smart people locked up inside the company working on projects with a high probability of going nowhere rather than having them going to a competitor, or worse, creating the next major competitor. 0: ht…

I've strongly suspected this of corporate R&D for decades. AT&T, IBM, Xerox, Microsoft.

Now Google and Facebook.

Re: Alphabet Loses $859M on 'Moonshots' in 2Q 2016

#69

Post by Normal_gaussian »

jahnu wrote: post #67
zaroth wrote: post #33

I don't think it's right to equate R&D spending with "losses". Google makes a profit, not a loss, so technically it does not have losses. It has expenses, and among those, investments in future technology. If all Google could do with their cash flow was pay a dividend, that would be very sad, and it would call for a much lower P/E ratio. This article completely misstates the facts. Perhaps the way they break out thei…

Playing devil's advocate here (a little) but imagine they took a few dozen million of that and, say, improved their development tool chains for Android (which are disappointingly flaky). Or another few dozen millions and extended the security updates for Nexus phones by a couple of years. That could grow their market share of both developer mind-share and consumers. Moonshots maybe should come once you've mastered al…

> Moonshots maybe should come once you've mastered all your core products?

Then they'll never come.

Re: Alphabet Loses $859M on 'Moonshots' in 2Q 2016

#70

Post by dredmorbius »

mfav wrote: post #25

Subtly dishonest journalism in my opinion. This article could just as easily be titled "Alphabet invests $859M on long-term projects". In fact, that would be a more accurate title since that is precisely Google's intent.

There's nothing subtle, and everything dishonest, about this.
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