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It never did. Otherwise it would have incorporated as a non-profit or a PBC. Since its inception, Google has always been a for-profit entity, which is legally r

It never did. Otherwise it would have incorporated as a non-profit or a PBC. Since its inception, Google has always been a for-profit entity, which is legally required to put shareholders profits as a higher priority than everything else.

ChrisLTD 8y ago
It's true that public corporations have to answer to their shareholders, but they are not legally required to maximize profit.
jsd2 8y ago
And if Google happened to be run by Larry Ellison or Rupert Murdoch trust me we would be paying for every single search query being run. Value matters. Even if they aren't perfect. Even if they cannot be achieved. Stating and restating your values simplifies moments when ambiguity and uncertainty and suffering test you.
- scarface74 8y ago
  Why would paying for a product that I use be a bad thing? I think it is better than the alternative that we have now.
- maxxxxx 8y ago
  I am starting to to think I would prefer if I could pay a company for a service directly, get the service and that's it. Instead we have all these "free" services that do all kinds of sleazy things with our data behind our backs.
  - pault 8y ago
    Why do you think paying for a service means the company won't also sell your data?
    - PavlovsCat 8y ago
      They didn't claim that, they stated a preference, and that preference implies not selling data with "that's it".
    - cobookman 8y ago
      ...like windows OS?
rosser 8y ago
> ...which is legally required to put shareholders profits as a higher priority than everything else. Please retire this egregiously broken misconstrual of fiduciary duty. I promise you, this is not the law, and you sound a fool for repeating it.
- xena 8y ago
  Then what is?
  - deleted 8y ago
    [deleted]
  - tlholaday 8y ago
    The law obliges management of a publicly traded company to report fairly to its shareholders its assets, liabilities, revenues, costs, and certain other items such as the compensation of the five most highly compensated officers. If a shareholder believes that management is not maximizing profits, the shareholder is at liberty to take his or her money and go elsewhere, by selling his or her shares.
    - rosser 8y ago
      If that shareholder elects instead to sue, they will almost certainly lose, absent specific evidence of bad faith or of breaches of the duties of care or loyalty, for example. The "business judgement rule" [0] compels courts to defer to the judgement of the executives of a business, on the basis that they have a bona fide interest in that business and its activities, and understand them better than either the court or J. Random Shareholder ever could. "The business judgment rule is very difficult to overcome and courts will not interfere with directors unless it is clear that they are guilty of fraud or misappropriation of the corporate funds, etc." [1] [0] https://en.wikipedia.org/wiki/Business_judgment_rule https://en.wikipedia.org/wiki/Business_judgment_rule [1] ibid.
  - vonmoltke 8y ago
    https://www.nolo.com/legal-encyclopedia/fiduciary-responsibility-corporations.html https://www.nolo.com/legal-encyclopedia/fiduciary-responsibi...
Frondo 8y ago
This is a myth. Companies can seek to maximize whatever they do, whatever their bylaws say.
longerthoughts 8y ago
I just wonder at what point public perception becomes so negative that they're actually jeopardizing profits. Not only are they getting criticized by the general public and the US government, but they've reached a point where their own employees are speaking out against them and even leaving the company on ideological grounds.
- stevehawk 8y ago
  The problem may be that the public doesn't seem to get it. They just don't seem to process, or care, that google is mining everything they give them - search, email/calendar/etc, Android, etc etc. I guess a lot of it is behind the scenes enough that they don't understand it or don't get riled up like they do about Facebook and the like.
  - pault 8y ago
    I have a non-technical friend who doesn't use facebook, pays for everything in cash, and will only use e2e encrypted chat clients, but he has this irrational hate for apple because "hipsters" and uses an android phone that literally documents his every move. It drives me crazy.
    - stevehawk 8y ago
      what cracks me up is I got downvoted but I'm pretty I'm right. Over on Ars people are excited about Google Fi.. which.. you know.. is just feeding even more data to the machine.. but hey it's Google and they said "Do No Evil" twenty years ago.
skybrian 8y ago
This based on a bad theory of corporate governance. "Shareholder value" is very vague and doesn't much restrict what companies do in practice. Companies can do opposite things while claiming to care about shareholder value. Also, due to Google's dual class stock, the founders cannot lose control of the company. If the company has lost its way, you can definitely blame them; they do have the power to make big changes. Companies like this do care about the stock price, but that's because employees (including powerful managers) own stock or options and want it to go up. If you want a company to pay less attention to the stock market, the best way would be to stop compensating employees this way.
cosmie 8y ago
Shareholder value[1], not shareholder profit. There's a subtle but important difference. It's pretty easy to engineer short term profits, but usually results in cannibalizing long-term value. The amassed engineering talent and accumulated knowledge-base at Google is a strategically important asset to Google, and defection of that knowledge-base en-masse would be a very bad thing. Both by handicapping Google's ability itself while simultaneously seeding the marketplace with a large concentration of individuals that know the inner workings of Google technology. While this already happens through normal attrition, happening en-masse would be far more of a market risk. In this instance, Google employees being as vocal as they are is more influential than you make it sound. Even viewing it through the lens of shareholder value. Which is also not actually a legal requirement, which [1] provides details about towards the end. [1] https://www.investopedia.com/terms/s/shareholder-value.asp https://www.investopedia.com/terms/s/shareholder-value.asp
groby_b 8y ago
Just for future reference: Nope. Not legally required. The whole "all obligation to the shareholders" is an idea that Milton Friedman had in the 60's, and that people kept repeating as a mantra: https://en.wikipedia.org/wiki/Friedman_doctrine https://en.wikipedia.org/wiki/Friedman_doctrine It is far from a legal concept, and even further from a universally accepted truth.
jimjimjim 8y ago
stop it. “Modern corporate law does not require for-profit corporations to pursue profit at the expense of everything else, and many do not.” https://www.nytimes.com/roomfordebate/2015/04/16/what-are-corporations-obligations-to-shareholders/corporations-dont-have-to-maximize-profits https://www.nytimes.com/roomfordebate/2015/04/16/what-are-co...

ChrisLTD 8y ago

It's true that public corporations have to answer to their shareholders, but they are not legally required to maximize profit.

jsd2 8y ago

And if Google happened to be run by Larry Ellison or Rupert Murdoch trust me we would be paying for every single search query being run. Value matters. Even if they aren't perfect. Even if they cannot be achieved. Stating and restating your values simplifies moments when ambiguity and uncertainty and suffering test you.

scarface74 8y ago
Why would paying for a product that I use be a bad thing? I think it is better than the alternative that we have now.
maxxxxx 8y ago
I am starting to to think I would prefer if I could pay a company for a service directly, get the service and that's it. Instead we have all these "free" services that do all kinds of sleazy things with our data behind our backs.
- pault 8y ago
  Why do you think paying for a service means the company won't also sell your data?
  - PavlovsCat 8y ago
    They didn't claim that, they stated a preference, and that preference implies not selling data with "that's it".
  - cobookman 8y ago
    ...like windows OS?

rosser 8y ago

> ...which is legally required to put shareholders profits as a higher priority than everything else. Please retire this egregiously broken misconstrual of fiduciary duty. I promise you, this is not the law, and you sound a fool for repeating it.

xena 8y ago
Then what is?
- deleted 8y ago
  [deleted]
- tlholaday 8y ago
  The law obliges management of a publicly traded company to report fairly to its shareholders its assets, liabilities, revenues, costs, and certain other items such as the compensation of the five most highly compensated officers. If a shareholder believes that management is not maximizing profits, the shareholder is at liberty to take his or her money and go elsewhere, by selling his or her shares.
  - rosser 8y ago
    If that shareholder elects instead to sue, they will almost certainly lose, absent specific evidence of bad faith or of breaches of the duties of care or loyalty, for example. The "business judgement rule" [0] compels courts to defer to the judgement of the executives of a business, on the basis that they have a bona fide interest in that business and its activities, and understand them better than either the court or J. Random Shareholder ever could. "The business judgment rule is very difficult to overcome and courts will not interfere with directors unless it is clear that they are guilty of fraud or misappropriation of the corporate funds, etc." [1] [0] https://en.wikipedia.org/wiki/Business_judgment_rule https://en.wikipedia.org/wiki/Business_judgment_rule [1] ibid.
- vonmoltke 8y ago
  https://www.nolo.com/legal-encyclopedia/fiduciary-responsibility-corporations.html https://www.nolo.com/legal-encyclopedia/fiduciary-responsibi...

Frondo 8y ago

This is a myth. Companies can seek to maximize whatever they do, whatever their bylaws say.

longerthoughts 8y ago

I just wonder at what point public perception becomes so negative that they're actually jeopardizing profits. Not only are they getting criticized by the general public and the US government, but they've reached a point where their own employees are speaking out against them and even leaving the company on ideological grounds.

stevehawk 8y ago
The problem may be that the public doesn't seem to get it. They just don't seem to process, or care, that google is mining everything they give them - search, email/calendar/etc, Android, etc etc. I guess a lot of it is behind the scenes enough that they don't understand it or don't get riled up like they do about Facebook and the like.
- pault 8y ago
  I have a non-technical friend who doesn't use facebook, pays for everything in cash, and will only use e2e encrypted chat clients, but he has this irrational hate for apple because "hipsters" and uses an android phone that literally documents his every move. It drives me crazy.
  - stevehawk 8y ago
    what cracks me up is I got downvoted but I'm pretty I'm right. Over on Ars people are excited about Google Fi.. which.. you know.. is just feeding even more data to the machine.. but hey it's Google and they said "Do No Evil" twenty years ago.

skybrian 8y ago

This based on a bad theory of corporate governance. "Shareholder value" is very vague and doesn't much restrict what companies do in practice. Companies can do opposite things while claiming to care about shareholder value. Also, due to Google's dual class stock, the founders cannot lose control of the company. If the company has lost its way, you can definitely blame them; they do have the power to make big changes. Companies like this do care about the stock price, but that's because employees (including powerful managers) own stock or options and want it to go up. If you want a company to pay less attention to the stock market, the best way would be to stop compensating employees this way.

cosmie 8y ago

Shareholder value[1], not shareholder profit. There's a subtle but important difference. It's pretty easy to engineer short term profits, but usually results in cannibalizing long-term value. The amassed engineering talent and accumulated knowledge-base at Google is a strategically important asset to Google, and defection of that knowledge-base en-masse would be a very bad thing. Both by handicapping Google's ability itself while simultaneously seeding the marketplace with a large concentration of individuals that know the inner workings of Google technology. While this already happens through normal attrition, happening en-masse would be far more of a market risk. In this instance, Google employees being as vocal as they are is more influential than you make it sound. Even viewing it through the lens of shareholder value. Which is also not actually a legal requirement, which [1] provides details about towards the end. [1] https://www.investopedia.com/terms/s/shareholder-value.asp https://www.investopedia.com/terms/s/shareholder-value.asp

groby_b 8y ago

Just for future reference: Nope. Not legally required. The whole "all obligation to the shareholders" is an idea that Milton Friedman had in the 60's, and that people kept repeating as a mantra: https://en.wikipedia.org/wiki/Friedman_doctrine https://en.wikipedia.org/wiki/Friedman_doctrine It is far from a legal concept, and even further from a universally accepted truth.

jimjimjim 8y ago

stop it. “Modern corporate law does not require for-profit corporations to pursue profit at the expense of everything else, and many do not.” https://www.nytimes.com/roomfordebate/2015/04/16/what-are-corporations-obligations-to-shareholders/corporations-dont-have-to-maximize-profits https://www.nytimes.com/roomfordebate/2015/04/16/what-are-co...