
Alphabet is still figuring out how to be a conglomerate - mirandak4
https://backchannel.com/alphabet-learns-that-change-isnt-as-easy-as-abc-e24df2673639#.8ype9626i
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ChuckMcM
_"...operating at a level of stealth unusual even for the normally secretive
firm."_

I chuckled at that. When I worked there I participated in no less than a dozen
"super secret" projects. Stealth was the standard operating mode. In
engineering I attributed it to the somewhat interesting way in which
recognition and promotions were handed out, which was to say if someone else
got word of your idea/project and executed on it more quickly they could
declare victory and take the glory. So keeping things secret until success was
assured was the "smart" play. And it didn't hurt than when things went south
you didn't have to take the blame since nobody knew you were working on it. A
win-win situation as they say.

Levy makes it sound like a big deal they were being super secret but really? I
suspect it was keeping things that might, or might not, happen in the future
from becoming part of the questions at a TGIF meeting.

What the re-organization has done has put a spotlight on how much Alphabet is
a one trick pony. It's a good trick, and a strong pony, but it doesn't
translate into other markets. And several other organizations have been
training their ponies hard and are taking away that specialness.

The current road Alphabet is on doesn't seem to me to end in a happy place, so
I continue to watch them to see if they will find a way to turn off it.

~~~
rdtsc
I think one of the underestimated functions of this kind of secrecy is to make
participants feels important and better about themselves.

"This is super-secret, therefore important. I was picked to work on important
stuff, so I must be important".

This goes for everyone in the chain including managers "I am managing a team
working on a super-secret project, I can't tell you about". That sounds a lot
better than "I am managing a team which makes Uber but for dogs".

I suspect this is partly also why governments like to classify everything,
even stuff that doesn't need to be -- it provides a level of importance and
adds ceremony to everything. Which, in turns makes everyone involved feel
important.

~~~
nostrademons
Also, to avoid making them feel _worse_ about themselves when what they're
working on doesn't work out, or when their coworkers are skeptics.

My experience was a bit different than ChuckMcM's; I was at Google a couple
years later, and my perception was that it was a lot more open internally than
any other company I've seen. But when projects were secret or semi-secret, it
usually seemed like it was so that the team members could take risks without
fear of criticism or ridicule. It's been my observation that for each famous
product Google has released, there is some famous person inside Google who
tried to kill it. Secrecy is a form of corporate anti-inflammatory, where it's
a way of overcoming the natural immune response against any idea that is new
and different.

~~~
ChuckMcM
I really like the corporate any-inflammatory idea. I think that really
captures it.

------
BinaryIdiot
Looks like the author wanted to write _something_ , _anything_ about Alphabet
since today is the one year anniversary but there isn't much substance in
here.

I would agree with some of the assertions that yes Google is still Google and
Alphabet seems almost non-present but I don't know if they have finished their
integration / breaking apart of groups or really much of anything. I still
think Android and some of the other parts of Google should _probably_ be split
out but I have no idea if that's the best choice for them or not.

I would love some more information on the whole formation of Alphabet. This,
unfortunately, is not that article.

~~~
patrickaljord
They cannot split out Android or Youtube from Google for regulatory reasons
(but not only), specially in Europe. The thing is, both Android and Youtube
rely on its ads business and users need to accept the privacy policy of
sharing their search history accros all platforms so that google can optimize
ads for them. Splitting Android, Youtube and Google Search into different
companies would make it very hard for Google to share user data between the 3.
Also, it makes sense to keep them together given that they are still highly
integrated, Android has great Youtube integration and Google Search integrates
Youtube videos directly in results and of course Google Search is at the
center of Android (Google Now etc). It would be more troubles than necessary
to split them all.

~~~
BinaryIdiot
As far as regulations / laws go it would not surprise me if that makes it
impossible but as far as technically? I don't buy it. I'm not sure what their
current infrastructure looks like but it was conveyed to me that each group
basically "consumes" the others through various types of APIs.

It would be interesting if they explored it at least. In my opinion anyway.

~~~
patrickaljord
Their may be some APIs involved but they also use the backend directly when
convenient for example Google Search may fetch directly from the google cloud
to fetch youtube videos as that's faster than doing http requests. Also, I
think they have one gigantic repository where all the code is shared,
splitting this repo would be more trouble than necessary.

~~~
BinaryIdiot
Fair points

~~~
disgruntledphd2
Since they merged their services a few years back, I've noticed that lots of
(my and others I know) requests for login appear to go through youtube. This
is presumably because it had the largest number of logged-in users
historically.

So yeah, that would be difficult to split out.

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dragonwriter
That's a whole lot of words to say almost nothing, and to confuse unrelated
things (like market cap and revenue, as in: "Wall Street seems to appreciate
the Alphabet structure. In the last year, the stock price has risen over a
hundred points and reached a record high this year, at a market cap of almost
$550 billion. These revenues virtually all come from the Google division, of
course.")

[EDIT: The article has been edited to make the particular paragraph quoted
above less nonsensical.]

~~~
nostromo
You're taking that out of the context of the article. The author clearly knows
the difference.

> Alphabet is a weird company. Only one part of it makes significant profits:
> Google, whose revenues are humongous. [...]

>Wall Street seems to appreciate the Alphabet structure. In the last year, the
stock price has risen over a hundred points and reached a record high this
year, at a market cap of almost $550 billion. Its revenues virtually all come
from the Google division, of course.

~~~
dragonwriter
That quote is not complete nonsense, but it wasn't the text at the time I read
it (which I cut and pasted in my post, you can compare.)

Its been rewritten to be somewhat less nonsensical (though the last sentence
of that paragraph is now both redundant with other parts of the article and a
non-sequitur in the paragraph it is included in.)

~~~
kbenson
I'm confused. The text you included and the text nostromo included differ only
in that one says "Its revenues" and the other says "These revenues". Is there
more to this that I'm missing?

~~~
dragonwriter
"These revenues come from..." when the only antecedent for "these" is the
market cap figure makes no sense, while "Its revenues come from..." where the
antecedent for "its" is clearly "Alphabet" makes sense, though (again) it is
redundant with other parts of the article and a non-sequitur in that
paragraph.

~~~
kbenson
Thanks, that clears it up. I'm apparently not nearly as sensitive to
attribution of items when reading about financials, since I rarely deal with
that realm.

------
aresant
Interesting that the first supporting paragraph on the "turmoil" this is
causing is Tony Fadell & Bill Maris leaving.

IMO Those are red herrings:

1) Fadell was extremely unpopular at the time of his departure after several
missteps and lack of product releases. He was going to be shown the door
regardless.

2) Bill Maris explanation is straight forward - he's super rich, just started
a family, is sick of being on airplanes and phone calls 24/7 and literally
CRUSHED IT as a VC on the weight of his Uber investment alone.

~~~
ocdtrekkie
There's a lot of others though.

\- Verily, formerly Google Life Sciences, is having similar CEO problems as
NEST. Word has it Verily has a whole lot of nothing to show for all the money
they've blown so far.

\- Chris Urmson just left the Self-Driving Car program. From my understanding,
of whatever the Self-Driving Car program allegedly managed to do (debatable),
Urmson was pretty key in them doing it.

\- Google Fiber just backed out of plans to dig fiber for a whole bunch of
cities they said they would, and are now looking at some cheaper wireless
broadcast option.

Also, I am almost certain that Tony Fadell was actually "fired". Being fired
is always phrased as "resigning" when you're that rich. But yeah, NEST has
been a paperweight since Google bought it. The only thing they've done is
rebranded Dropcam. And apparently ruined the Dropcam team while doing it.

------
profeta
Summary: google is still google. It still have tons of heads and all the
profit remained there (android, youtube, etc). Alphabet is just a place for
the litigation-prone products, such as Nest and self driving cars.

~~~
SilasX
Yes, it's still Google. Who actually calls it Alphabet in everyday speech?

~~~
zitterbewegung
Everyone in finance seems to call it that but thats pretty much the only ones.

~~~
dragonwriter
Well, sure, because the entity most people care about is the Alphabet unit
called "Google", except for finance people, who mostly care about the thing
you can invest in, which is Alphabet.

------
Animats
Self-driving cars are a great concept and will make money, but reality is
starting to set in at Alphabet. Their destiny is not to disrupt the auto
industry. Their destiny is to be an auto parts supplier in Novi, MI. Google is
going to be selling a set of components to auto manufacturers for about
$1000-$3000 to make a car self-driving. Self-driving will be an option the
customer orders at the dealership, along with other infotainment options.

This is kind of a letdown for Google's people. Less going to TED and SXSW,
more going to the Automotive Parts Suppliers Conference at the Marriott in
Troy, Michigan. This may explain some of the turnover.

~~~
ghaff
And basically assistive driving systems for the next decade or so with any
sort of "disruptive" self-driving most likely further out. And this is
something that all the major auto manufacturers are working on to greater or
lesser degrees.

------
dimino
I don't understand why there's so much hay being made over Alphabet's reliance
on Google to fund its other ventures. Wasn't that the whole fucking point, to
provide a way to separate the moonshots from Google, to ensure Google's
profitability gets reported accurately, and not hit by the losses from the
other projects?

Furthermore, aren't these project _designed_ and expected to not be profitable
in the medium term, with the hope/prayer of _huge_ , life altering payoffs for
humanity "eventually"?

~~~
linkregister
Yes, the extent to which Alphabet is pursuing this is rare among other large
companies. I love this R&D-heavy model. And so do many GOOG shareholders.

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patmcguire
Lol'd at "(Alphabet better be careful — if things get even better, no one will
work there anymore)"

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geodel
Well, I am not sure how much change was expected in 1 year. Was it that all
other projects start posting Google level revenues or profits?

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SmellTheGlove
I'm not really sure what the intent is here. Alphabet is a holding company and
you rarely hear anything about them. Outside of the annual shareholders
meeting, is anyone really writing about what Berkshire Hathaway is doing in
Omaha day to day? No, they write about their businesses. There's really not
much to add to the conversation regarding the holding company itself, since
it's really a top level entity meant to compartmentalize business units, often
for risk purposes.

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swyman
I thought Fadell leaving was universally viewed as a positive...

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adamb_
I wonder if breaking up a monolithic company like Google has similarities to
breaking up a monolithic legacy Java EE app :P

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kctess5
They spelled "Verily" wrong in the 3rd paragraph (they wrote "Verity"). That's
where I stopped reading.

