Splitting Alphabet is good
I have been getting a feeling lately that there is a growing negative in-general perception about Alphabet as a whole especially from stock growth point of view. I feel that some of the beasts that we have are much more worth than they are in hiding e.g. waymo, verily, YouTube , deepmind, cloud and then Google itself as a beast . Given how crazy stock market could be for futuristic bets and not even profitability, many of the investors might be interested in waymo alone or YouTube alone etc .. I strongly feel it will benefit the execution (publicly) , good for employees, good for investors and good for everyone. What do you guys think ?
Splitting unlocks shareholder value. There are people who want to invest in autonomous cars, but not Google ads. And vice versa. When you don't split up the company, you lose those investors. Less demand for stock = lower price. And for those who would argue Google can subsidize autonomous cars, and Waymo would die without Google's funding: if it's a good idea, investors will come. The argument is that the sum of the parts will be higher than the combined entity, but some individual parts may benefit / be hurt in ways different from other parts.
Ad systems have major economies of scale. Splitting the ads businesses (e.g. search + YouTube) apart seems like value destruction. GCP + enterprise software could be split easily-ish. The misc alphabet projects could be spun out or shut down.
Yeah so be it .. if something has to shutdown then let the public decide it's fate openly in the world as opposed to coaster VP's and execs that shut things down.
Perception has many facets to it that one way or another affects stock growth: 1. Consistently failing products one after another (beyond GCP too). 2. People don't apply to Google anymore at L6+ levels due to erratic hiring process that can take up 6 months+. 3. Very slow career growth.
Yes and it means people could apply to N companies separately if they want to work there.. people could still apply to waymo verily separately but it's less pressure situation because google is funding you big time .. you don't have your ass on fire like in a startup ..
Yeah it won't work. YouTube for example, only has a content monopoly that is hard to beat bc Google search (which is also a monopoly) bubbles up that content. Imagine YouTube competing fairly! That app sucks as apps go for both iOS and Android, not to mention they censor people who is on the wrong side of some political beliefs. Let's take Google Cloud. No, it sucks, and is a distant third behind Amazon and Microsoft. The only reason they're even third is the Google name. What else? Google office apps? Maybe that one.
1) waymo 2) YouTube ( it doesn't need google name anymore ) , it can compete with other platforms on rankings and that is better for the entire ecosystem 3) verily 4) cloud - again no need of Google name anymore and the growth is amazing compared to azure / aws , this could lead to a high profile acquisition also which is again great for investors 5) google search/ ads / maps / images/ chrome/gmail all together 6) android and hardware 7) deepmind and other AI efforts ..
You're drinking the coolaid. Google cloud sucks compared to aws and Azure and is a very distant 3rd. Youtube would be dead without Google helping it out in search rankings. Sorry, but there is such a thing as synergy. You should know this, as 70% of Google's revenue is ads. If YouTube was a separate entity, they wouldn't know the ad identity of the person who Google referred through their search (where most YouTube traffic originates)
What would be the point of splitting that way? Would you create more competition/more choices for customers as the result of that?
Yes exactly. The heads needs to worry about public image, balance sheet and execute fast and as a result everyone will benefit.