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Google is so badly managed (e.g. Stadia failure recently) that I am surprised that investors tolerated their insane cash burning for so long. Now the stakeholde

Google is so badly managed (e.g. Stadia failure recently) that I am surprised that investors tolerated their insane cash burning for so long. Now the stakeholders want better results than one failed launch per year. It is unfathomable how GCP can be so far behind AWS and Azure. I think Google will soon have a new CEO, during last few years they provided very little innovation that can pay for itself.

throwaway5959 4y ago
I’m amazed that they don’t have a new CEO already, or at least haven’t dramatically cut his pay.
- hnfong 4y ago
  Multiple share classes means that Alphabet's CEO only needs to curry favor with two people to keep his job. I wonder whether this would end up being a case study in MBA classes....
- BuyMyBitcoins 4y ago
  Further evidence that their core product, search, has deteriorated so badly that they can’t find a better CEO. /s
mnd999 4y ago
Cash burn or burn rate are usually terms applied to investor backed startups. Google is a profitable company, it doesn’t have cash burn.
dougmwne 4y ago
There are no stakeholders, there is only Larry and Sergey. Due to the innovative IPO, the founders keep voting control of the company with only 3% ownership and the shareholders come along for the ride.
- hansvm 4y ago
  Voting control gives you power, but you still have responsibilities. You can't just ignore those 97%.
  - svantana 4y ago
    Honest question: why not? Those 97% should have been fully aware of this arrangement when they bought their stock.
    - hn_throwaway_99 4y ago
      The company still has a fiduciary duty to all shareholders, not just majority owners. A smaller shareholder could still argue in court that management is breaching those responsibilities. That said (and IANAL), at least the couple suits I'm familiar with in this area have to do with minority shareholders arguing some decision was made to benefit majority owners at the expense of minority shareholders. It's much, much more difficult to just argue "bad decision making" if all shareholders are affected equally.
      - dougmwne 4y ago
        Is there any precedent for that happening?
        hansvm 4y ago
        Tons. Searches starting with "minority shareholder oppression lawsuit" should point you in the right direction.
  - skrebbel 4y ago
    Of course you can.
    - hansvm 4y ago
      If we're being pedantic, you can't do so without incurring a non-negligible risk of legal consequences often exceeding the personal gains from screwing over the shareholders.
ajross 4y ago
I don't see how one gets the Stadia shutdown as a failure of management? As software, it worked really (frankly shockingly) well. You might argue that it was a failure of product targetting, maybe of business relationship management, maybe that the pricing didn't match the cost of service, etc... But the employees tasked by Google to produce a cloud-based streaming gaming service, successfully shipped a cloud-based streaming gaming service. That's good management, not bad. Edit: ooph, I can see where this is going but people have replied so I should leave it up. FWIW: the term "management" in this context is generally interpreted strictly, and not just a shorthand for "every decision made by an executive". The complaints people have with Stadia are better termed "marketing" (building the wrong product or canceling it too soon) or "sales" (failing to get enough games on the product). "Management" (the application of corporate resources to achieve results) did their job. And in particular, in the context of layoffs ("management" by definition) it seems like the usage above was ambiguous enough to demand a correction. Stadia being mismarketed simply isn't relevant to the employment status of massage therapists.
- hiddencost 4y ago
  I think you're affirming what the parent said? Engineering did their job, well. Leadership and product did not. This has been the trend at Google during Sundar and Ruth's tenure: a company led by engineers became a company led by product management and finance. And it shows. Google's made a crushing number of business decisions that flew in the face of good engineering principles, and undermined the company's excellence.
  - CardenB 4y ago
    It’s been since google plus, long before sundar.
- sitkack 4y ago
  As typical here, you both aren’t taking about the same things. One is talking about market strategy and perseverance. The other is talking about technical leadership. You could have made the same insightful (inciteful) post by just commenting on how good technical leadership was. I was shocked the other day when a solid respectable chip designer said Alpha was a failure because DEC went out of business.
kampsduac 4y ago
Where can I learn more about the claim that GCP is behind AWS and Azure?
- sokoloff 4y ago
  Use any search engine for something like "AWS Azure GCP market share". The first link I got was: https://wire19.com/amazon-microsoft-and-google-cloud-infrastructure-market/ https://wire19.com/amazon-microsoft-and-google-cloud-infrast... which shows AWS as 3+x GCP and Microsoft ~2x GCP.
  - lokar 4y ago
    They include office in the total
    - sokoloff 4y ago
      Fair point. That makes AWS's dominance even more stark. Edit to add: it looks like Alphabet reports GSuite as part of Google Cloud as well.
- xhkkffbf 4y ago
  Yes. I'm curious too. The commodity servers seem competitive in terms of price and performance. Plus, it has several nice features like Firebase. But if someone wants to chime in, I would like to hear how they're behind.
mbesto 4y ago
> Google is so badly managed. Google's market cap is $1.2T and their TTM net income was ~$65B.
- zoover2020 4y ago
  I think heir comment was more talking from an R&D perspective, I.e. them being innovative. I agree that slowly sliding the "% of ads our customers see"-slider to the right over the last couple of years until it becomes unbearable isn't really _that_ innovative but still yields a ton of profit.
qbasic_forever 4y ago
What cash burn? They've been turning profit quarter after quarter. The cost of 31 massage therapists is a rounding error compared to salaries for senior engineers, of which there are tens of thousands employed.
- hn_throwaway_99 4y ago
  Saying a company is "burning cash" is not the same as saying they're unprofitable. Indeed, the general argument is that Google's ads machine is so profitable that they can run the business horribly inefficiently because they don't know where to put all that cash.
  - TheCoelacanth 4y ago
    If a company is "burning cash" at the same time that they are "printing cash", I think you're definitely using the first phrase in a non-conventional way.
    - hn_throwaway_99 4y ago
      Context matters. The original statement was: > Google is so badly managed (e.g. Stadia failure recently) that I am surprised that investors tolerated their insane cash burning for so long. That is, I (and I think most others) interpreted that as Google was essentially lighting a big pile of their cash on fire due to poor management, not that they were unprofitable. That would be very different, for example, than a statement like "Most of these new car companies are burning cash at an unsustainable rate."
hn_throwaway_99 4y ago
I think stuff like ChatGPT and Stable Diffusion may light the fire under Google they finally need. Washington Post had a good article on this today: https://www.washingtonpost.com/technology/2023/01/27/chatgpt-google-meta/ https://www.washingtonpost.com/technology/2023/01/27/chatgpt... What happened to Google is what happens to all fat monopolists: they had the luxury of losing focus because their monopoly was so profitable. I do really feel that Google (among others) is finally seeing the type of existential risk much better AI is to Google's ad business. While I'm definitely not of the opinion that "ChatGPT is a Google killer", it's not that hard to see that a company whose velocity in this space is currently much faster that Google's could eventually overtake Google's bread-and-butter search business in 5-10 years.

throwaway5959 4y ago

I’m amazed that they don’t have a new CEO already, or at least haven’t dramatically cut his pay.

hnfong 4y ago
Multiple share classes means that Alphabet's CEO only needs to curry favor with two people to keep his job. I wonder whether this would end up being a case study in MBA classes....
BuyMyBitcoins 4y ago
Further evidence that their core product, search, has deteriorated so badly that they can’t find a better CEO. /s

mnd999 4y ago

Cash burn or burn rate are usually terms applied to investor backed startups. Google is a profitable company, it doesn’t have cash burn.

dougmwne 4y ago

There are no stakeholders, there is only Larry and Sergey. Due to the innovative IPO, the founders keep voting control of the company with only 3% ownership and the shareholders come along for the ride.

hansvm 4y ago
Voting control gives you power, but you still have responsibilities. You can't just ignore those 97%.
- svantana 4y ago
  Honest question: why not? Those 97% should have been fully aware of this arrangement when they bought their stock.
  - hn_throwaway_99 4y ago
    The company still has a fiduciary duty to all shareholders, not just majority owners. A smaller shareholder could still argue in court that management is breaching those responsibilities. That said (and IANAL), at least the couple suits I'm familiar with in this area have to do with minority shareholders arguing some decision was made to benefit majority owners at the expense of minority shareholders. It's much, much more difficult to just argue "bad decision making" if all shareholders are affected equally.
    - dougmwne 4y ago
      Is there any precedent for that happening?
      - hansvm 4y ago
        Tons. Searches starting with "minority shareholder oppression lawsuit" should point you in the right direction.
- skrebbel 4y ago
  Of course you can.
  - hansvm 4y ago
    If we're being pedantic, you can't do so without incurring a non-negligible risk of legal consequences often exceeding the personal gains from screwing over the shareholders.

ajross 4y ago

I don't see how one gets the Stadia shutdown as a failure of management? As software, it worked really (frankly shockingly) well. You might argue that it was a failure of product targetting, maybe of business relationship management, maybe that the pricing didn't match the cost of service, etc... But the employees tasked by Google to produce a cloud-based streaming gaming service, successfully shipped a cloud-based streaming gaming service. That's good management, not bad. Edit: ooph, I can see where this is going but people have replied so I should leave it up. FWIW: the term "management" in this context is generally interpreted strictly, and not just a shorthand for "every decision made by an executive". The complaints people have with Stadia are better termed "marketing" (building the wrong product or canceling it too soon) or "sales" (failing to get enough games on the product). "Management" (the application of corporate resources to achieve results) did their job. And in particular, in the context of layoffs ("management" by definition) it seems like the usage above was ambiguous enough to demand a correction. Stadia being mismarketed simply isn't relevant to the employment status of massage therapists.

hiddencost 4y ago
I think you're affirming what the parent said? Engineering did their job, well. Leadership and product did not. This has been the trend at Google during Sundar and Ruth's tenure: a company led by engineers became a company led by product management and finance. And it shows. Google's made a crushing number of business decisions that flew in the face of good engineering principles, and undermined the company's excellence.
- CardenB 4y ago
  It’s been since google plus, long before sundar.
sitkack 4y ago
As typical here, you both aren’t taking about the same things. One is talking about market strategy and perseverance. The other is talking about technical leadership. You could have made the same insightful (inciteful) post by just commenting on how good technical leadership was. I was shocked the other day when a solid respectable chip designer said Alpha was a failure because DEC went out of business.

kampsduac 4y ago

Where can I learn more about the claim that GCP is behind AWS and Azure?

sokoloff 4y ago
Use any search engine for something like "AWS Azure GCP market share". The first link I got was: https://wire19.com/amazon-microsoft-and-google-cloud-infrastructure-market/ https://wire19.com/amazon-microsoft-and-google-cloud-infrast... which shows AWS as 3+x GCP and Microsoft ~2x GCP.
- lokar 4y ago
  They include office in the total
  - sokoloff 4y ago
    Fair point. That makes AWS's dominance even more stark. Edit to add: it looks like Alphabet reports GSuite as part of Google Cloud as well.
xhkkffbf 4y ago
Yes. I'm curious too. The commodity servers seem competitive in terms of price and performance. Plus, it has several nice features like Firebase. But if someone wants to chime in, I would like to hear how they're behind.

mbesto 4y ago

> Google is so badly managed. Google's market cap is $1.2T and their TTM net income was ~$65B.

zoover2020 4y ago
I think heir comment was more talking from an R&D perspective, I.e. them being innovative. I agree that slowly sliding the "% of ads our customers see"-slider to the right over the last couple of years until it becomes unbearable isn't really _that_ innovative but still yields a ton of profit.

qbasic_forever 4y ago

What cash burn? They've been turning profit quarter after quarter. The cost of 31 massage therapists is a rounding error compared to salaries for senior engineers, of which there are tens of thousands employed.

hn_throwaway_99 4y ago
Saying a company is "burning cash" is not the same as saying they're unprofitable. Indeed, the general argument is that Google's ads machine is so profitable that they can run the business horribly inefficiently because they don't know where to put all that cash.
- TheCoelacanth 4y ago
  If a company is "burning cash" at the same time that they are "printing cash", I think you're definitely using the first phrase in a non-conventional way.
  - hn_throwaway_99 4y ago
    Context matters. The original statement was: > Google is so badly managed (e.g. Stadia failure recently) that I am surprised that investors tolerated their insane cash burning for so long. That is, I (and I think most others) interpreted that as Google was essentially lighting a big pile of their cash on fire due to poor management, not that they were unprofitable. That would be very different, for example, than a statement like "Most of these new car companies are burning cash at an unsustainable rate."

hn_throwaway_99 4y ago

I think stuff like ChatGPT and Stable Diffusion may light the fire under Google they finally need. Washington Post had a good article on this today: https://www.washingtonpost.com/technology/2023/01/27/chatgpt-google-meta/ https://www.washingtonpost.com/technology/2023/01/27/chatgpt... What happened to Google is what happens to all fat monopolists: they had the luxury of losing focus because their monopoly was so profitable. I do really feel that Google (among others) is finally seeing the type of existential risk much better AI is to Google's ad business. While I'm definitely not of the opinion that "ChatGPT is a Google killer", it's not that hard to see that a company whose velocity in this space is currently much faster that Google's could eventually overtake Google's bread-and-butter search business in 5-10 years.