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They want market share more than anything. The intention is to trade short-term profits for long-term customers. This is a reasonable business strategy, especia

They want market share more than anything. The intention is to trade short-term profits for long-term customers. This is a reasonable business strategy, especially for a business with a relatively undiversified source of profits. Of course the short-term profits being lost don't seem so short-term at this point, so Google is surely debating internally on how long they want to continue this strategy if it doesn't begin to pay off.

dodobirdlord 5y ago
> so Google is surely debating internally on how long they want to continue this strategy if it doesn't begin to pay off I am certain that nobody is considering shuttering a business unit that has an annualized revenue of $16 billion and is growing 46% per year. Anyone who is “surely debating” this would be fired from management at any sensible company.
- ocdtrekkie 5y ago
  It is worth noting that Google has shuttered dozens of products will multiple millions of users that nearly any other sensible company would not shutter, and which, outside of Google, would be considered wild successes. (So few are spun off as separate companies because Google's internal architecture is basically incompatible with anyone else operating their products.) Google isn't interested in being a minority player in any market, if they can't capture it, they will eventually leave it.
  - dmoy 5y ago
    Have they shuttered any with >$10b of revenue and >40% growth?
  - cromwellian 5y ago
    Users != Customers as you well know. If a startup outside of Google had millions of users, they wouldn't be considered a wild success unless they could monetize those users, otherwise it's just an enormous cost that eventually leads to failures once they run out of VC runway. And let's be real, a huge swath of VC funded startups recklessly engage in "growth hacking" to acquire users, without a legitimate business plan, usually, e.g. Step 1: get users Step 2: <magic happens> Step 3: Profit! And then it turns out their ideas for monetization don't work, and they get an exit via acquisition by one of the big players as the VCs try to get some of their money back and leave someone else holding the bag. SV is littered with companies that had millions of users but ended up folding and selling, because ultimately, running a business isn't free, and those users have to generate enough revenue to cover costs plus ROI.
    - ocdtrekkie 5y ago
      Sure, but most of these otherwise successful products never even attempted a business model. I could pick a dozen Google apps today and challenge you to determine how Google ever expected to benefit from them. Ironically, most random Google apps don't even display ads. I assume some might exist solely to collect ad data, but I am not sure if Google's ad team is investing steadily in how to mine worthwhile data out of each and every scattered new Google app. Which is to say, there's probably a decent number of apps Google created and shut down, which probably would've been pretty successful companies on their own with a modest monetization model. But Google never attempted it, because the user count didn't hit nine figures.
enos_feedler 5y ago
The toothpaste is out of the tube on this one. Outside of the current path, I think the only option is spinning off GCP into a separate company. I don't think this is a bad idea either.
- drcode 5y ago
  I'm with you on the AI. If AGI is possible in the next decade, I'd argue Google has at least a 30% chance of being the company to pull it off.
  - disgruntledphd2 5y ago
    > If AGI is possible in the next decade Fortunately, AGI is almost certainly not possible in the next decade.

dodobirdlord 5y ago

> so Google is surely debating internally on how long they want to continue this strategy if it doesn't begin to pay off I am certain that nobody is considering shuttering a business unit that has an annualized revenue of $16 billion and is growing 46% per year. Anyone who is “surely debating” this would be fired from management at any sensible company.

ocdtrekkie 5y ago
It is worth noting that Google has shuttered dozens of products will multiple millions of users that nearly any other sensible company would not shutter, and which, outside of Google, would be considered wild successes. (So few are spun off as separate companies because Google's internal architecture is basically incompatible with anyone else operating their products.) Google isn't interested in being a minority player in any market, if they can't capture it, they will eventually leave it.
- dmoy 5y ago
  Have they shuttered any with >$10b of revenue and >40% growth?
- cromwellian 5y ago
  Users != Customers as you well know. If a startup outside of Google had millions of users, they wouldn't be considered a wild success unless they could monetize those users, otherwise it's just an enormous cost that eventually leads to failures once they run out of VC runway. And let's be real, a huge swath of VC funded startups recklessly engage in "growth hacking" to acquire users, without a legitimate business plan, usually, e.g. Step 1: get users Step 2: <magic happens> Step 3: Profit! And then it turns out their ideas for monetization don't work, and they get an exit via acquisition by one of the big players as the VCs try to get some of their money back and leave someone else holding the bag. SV is littered with companies that had millions of users but ended up folding and selling, because ultimately, running a business isn't free, and those users have to generate enough revenue to cover costs plus ROI.
  - ocdtrekkie 5y ago
    Sure, but most of these otherwise successful products never even attempted a business model. I could pick a dozen Google apps today and challenge you to determine how Google ever expected to benefit from them. Ironically, most random Google apps don't even display ads. I assume some might exist solely to collect ad data, but I am not sure if Google's ad team is investing steadily in how to mine worthwhile data out of each and every scattered new Google app. Which is to say, there's probably a decent number of apps Google created and shut down, which probably would've been pretty successful companies on their own with a modest monetization model. But Google never attempted it, because the user count didn't hit nine figures.

enos_feedler 5y ago

The toothpaste is out of the tube on this one. Outside of the current path, I think the only option is spinning off GCP into a separate company. I don't think this is a bad idea either.

drcode 5y ago
I'm with you on the AI. If AGI is possible in the next decade, I'd argue Google has at least a 30% chance of being the company to pull it off.
- disgruntledphd2 5y ago
  > If AGI is possible in the next decade Fortunately, AGI is almost certainly not possible in the next decade.