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Admitting they're just an ad company would collapse the delusion that drives their share price.
by peepeepoopoo5 3y ago
Admitting they're just an ad company would collapse the delusion that drives their share price.
- jimsimmons 3y agoEveryone knows Google is an ad tech company. Real question is if they can diversify long term to be something beyond. Cloud is a great way to achieve this
- operatingthetan 3y agoYou could probably make a stronger point without an attack like this. edit: removed my quote of the attack since OP did.
- jimsimmons 3y agoGood point. Edited
- Ecstatify 3y agoOnce companies grow as big as Google nothing really moves the needle. They need to acquire competitors to grow revenue. Any Google service that doesn’t meaningfully impact the next quarterly earnings should start getting ready for the chopping block.
- adalacelove 3y agoFirst you loose the ability to build things and then you loose the ability to buy good things instead of crap.
- pfannkuchen 3y agoLong term diversification need at this point might be a little bit questionable. Like, will a global information network without ads ever exist? They just need to not lose in ads. Granted, they could lose access to more and more content walled gardens, but they could perhaps focus on penetrating those instead of focusing on distractions?
- khuey 3y agoAlphabet trades at a P/E of 27, hardly delusional.
- bryanlarsen 3y agoDuring times of low interest rates, 27 is a reasonable P/E. When interest rates are high, it isn't. A P/E of 25 is a rate of return of 1/25 or 4%. TBills return 5% and are a lot less risky.
- khuey 3y agoThe S&P 500 as a whole is trading at a P/E of 24. If there are any delusions about equity valuations they're not specific to Google.
- reducesuffering 3y agoWhen inflation is 5%, stocks are long term immune due to their price being denominated in the inflating currency. T bills will still return 5% but stocks will 4% return + 5% inflation for 9%
- rektide 3y agoIt's a bit stickier, in that Google's very existence depends on there being a healthy, compelling world wide web, and there being just not that many people funding or supporting or driving that quest. Google has to be a power for good open source & web. Otherwise they risk losing their whole business to apps & closed Oses, where they have next to no competitive advantage.
- cageface 3y agoThis is why I continue to support them despite all their issues. Not because I trust them to do the right thing out of principles at all, but just because their financial interests are more aligned with the open web than the other big tech companies.
- graftak 3y agoI want to agree with you but at the same time I have contempt for Google as they pulled stuff like AMP in an attempt to take hostage of the (open) web. Edit: not to forget Google uses their hold on the browser market share to push many platform APIs that only further their own goals with little care for privacy.
- rektide 3y agoAMP had some really awful aspects to it, was a power grab. But it also tackled a very real existential crisis, that sites were being incredibly poorly built with ghastly performance, and they did make an ok toolkit. Going power mad & hosting all the content themselves was obscene though.
- whoisthemachine 3y agoI agree entirely with your reasoning. But just watching what has happened to numerous Google products in the last decade (perhaps starting with Google reader?), it has become clear to me that Google's ad revenue is what wags the dog, so to speak, regardless of long-term considerations.