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Comment by bronzeage | Hacker News Reader

The brilliant engineers argument is pretty blind to the way these corporations might not make the most potential of some people. I know brilliant person which moved to work for Google because of the pay, and he was spending time there doing mundane testing. It's pretty known issue that Google easily hires brilliant people, it becomes so crowded they don't really use their potential.

At least Google is desperately trying to diversify away from ads only. Facebook doesn't. And Facebook has even bigger problem: their ads are a distraction, and younger people are getting more and more adapt at subconsciously ignoring this distraction. I've seen young kids automatically reaching for the the skip ad button in YouTube. I would argue that in 10 to 20 years, most of humanity will be immune to forced advertisements.

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> I've seen young kids automatically reaching for the the skip ad button in YouTube.

Does anyone not? Anyone who doesn't run uBlock Origin, I mean.

Hell, by the early 2000s I automatically tuned out anything banner-shaped to the point where it sometimes took a while to notice menus if they looked too much like a banner.

I cancelled cable and paid for YouTube Premium when it became evident that my kids were spending more time there than watching the TV.

I try to do my bit to pay for stuff I like if I can get it without ads. What really annoys me is stuff I pay for that still has ads.

Do they all share 1 account? Or is there a family plan?

There are family plans.

The difference is back in 2000s the technically savvy demographic did not have the purchasing power to make a difference , i.e. people who had money to buy things clicked on ads. Things have already changed that is partly why making ads to get easy revenue is harder, in another 20 years there will not be a pre-internet generation who can be dependent on to click ads.

However ads are not going away, for example although I pay for YT premium and run ublock origin, there are plenty of ads within the video itself . if you have browsed education videos on YT you will know brands like CuriosityStream, nebula, nordVPN, brilliant, skillshare. etc.

Similar and far worse practices happen in other mediums, with influencers on instagram and sponsored posts masquerading as neutral content etc.

It is becoming lot harder to filter it out, lesser and lesser ads are effective we will see more of this .

> Does anyone not? Anyone who doesn't run uBlock Origin, I mean.

Well, youtube-dl is technically not the same thing as uBlock Origin, right?

Does anyone not?

Me. Because if I like the content, I believe that letting the ad run is the very least I can do to support the person who created it and encourage them to create more content. I'm not a leech.

Google has been desperately trying to diversify from advertising for at least 15 years.

And they'd have landed a few hits by now if their internal incentive structure didn't prohibit follow-through. Have they fixed that yet?

given the 6m disclosed G Suite customers, they only need an average revenue of $167/u/y ($13.9/u/m) to have a billion dollar business. Given their pricing structure, I'd guess they are most likely close or past that run rate.

Google made $162 billion last year. GSuite would be a little over 0.5% of their revenue if that were the case. How much of that would translate to profit?

I would think though GSuite/Chromebooks would be a success story because of the education market.

I have no idea how much profits G Suite make (or don't).

Nonetheless, billion dollar opportunities don't grow on trees. They have tons of neighboring area to grow into -- ADFS, directory, IdP, etc.

$1 billion dollar revenue opportunities are child’s play for large tech companies. The profit margins are what matter.

I am really surprised they haven't managed to diversify into one other area properly. I used to think that with the number of smart people they have, it was only a matter of time before they had a strong revenue stream from other than ads. But seems like they are struggling to do that. I guess one issue is that any new revenue stream looks minuscule when compared to ads revenue and hence gets killed off before it has the chance to establish and grow.

Let’s compare that to the other big tech companies.

Facebook - yeah it’s just a social media company at its core, but before mobile really took off, it made money as a platform for games and shortly after its IPO, everyone thought it was doomed and didn’t get mobile. Between their strong pivot into mobile ads and their very smart acquisitions. Now FB has four platforms - FB, Instagram, Messenger, and WhatsApp that all serve different demographics.

Apple. During the time that Google has existed, Apple has gone from making most of its money selling computers, to music players and a music store, phones, and now depending on the quarter, phone sales are less than 50% of revenue. Heck the watch and AirPods are each considered to be larger businesses than the iPods were at its peak.

Would Google ever invest in a product that only made up 10% of its revenue?

Amazon: (Disclaimer: I work at Amazon). Went from a retail store selling its own stuff, to a marketplace, smart speakers, AWS, Amazon Prime Video, and did a lot of successful acquisitions.

Microsoft - It’s basically removed it’s focus from Windows to Azure, Office in every imaginable platform, Sql Server even runs on Linux now, and has a successful gaming division.

I don't really see the difference between Facebook and Google. I mean besides the search engine Google has Android, YouTube, all their ad network stuff (Doubleclick, AdSense, etc.)

In fact, the only 2 areas I think Google has really underperformed are:

1. The cloud. I'm a big fan of GCP, and I think in many ways it's easier to use than AWS, but Google still doesn't understand enterprise support and what big business customers value. I think a lot of this is just because Google doesn't have customer support in their DNA, and they had so much custom tech for so long (most big businesses want to use a relational DB, not Datastore).

2. Business applications. I feel like Sheets and Doc should have taken a much bigger chunk out of MS Office revenue than they have, but again enterprise support just isn't in their culture and hence G Suite lags.

According to information that came out during the Oracle lawsuit, Android had only made Google around $22 Billion in profit from inception through 2016 (https://www.reuters.com/article/us-oracle-google-lawsuit-idU...). Google pays Apple a reported $8 billion a year to be the default search engine on iOS. Apple makes more on a Google from mobile than Google makes from Android. In other words, all of the money that Google makes from Android isn’t enough to pay Apple for it to be the default search engine.

Youtube is still thought you be at best slightly above break even in terms of profitability.

What happens to the ad network between ad blocking and businesses keep realizing that you can do better targeting with Facebook?

That $22 billion number (which basically sounds like it was just a number made up from Oracle's lawyers, never confirmed by Google) from the article you posted is definitely not comparing apples-to-apples.

I can guarantee that being in control of the world's dominant mobile OS, and all the default Google search engine installs, Google Maps installs, etc. that entails, is worth much more in terms of mobile ad revenue than any directly-attributed OS revenue.

That number was not made up by Oracle. That came from Google as part of the discovery process.

Being in control of the major mobile OS when the most affluent customers are on iOS is a Pyrrhic victory. There is a reason that Google is willing to pay Apple more than $8 billion dollars when it only has a 13% global marketshare. Advertisers care much more about reaching people who are willing to pay $650 for a device than people who are paying less than $250.

On top of that Google has a rev share with OEMs for ads.

Google is non existent in China.

You’re missing oculus and portal for facebook. Hardware stuff.

Neither are successful and profitable.

It looks like the Oculus Quest is constantly sold out, are you sure it's not profitable? (I actually have no idea, but it seems quite successful as a product.)

“Sold out” doesn’t mean anything if the are selling below cost (doubtful) or if they aren’t selling enough to make it worthwhile investment of time and money.

I think the correct answer is more nuanced

What’s more nuanced than if a product is successful than does it make money?

Of course a product doesn’t have to be profitable on its own if you’re selling razor blades at a loss to sell razors. But neither product is doing that.

That's more to do with the unviability of VR than Oculus itself. If (rather, when) VR becomes viable, Oculus will be front and center - it has cornered mindshare in the space

People have been saying that VR was right around the corner since the Virtual Boy in the mid 90s.

The console market itself is tiny in the grand scheme of things. The PS4 has only sold 102 million units since inception. The VR market won’t even be that big. In contrast, Apple alone sells that many phones over two quarters

I'm not particularly bearish on VR but it's clear that the technology is far, far more mature than anything in the 90s.

Hardware sales are anyhow not quite as important as the software that runs on the hardware. The console market might be small, but the gaming market is absolutely massive. Facebook doesn't have to make money off Oculus hardware of it can, like Sony and Microsoft, get people into the ecosystem where $60 games are the norm and microstransactions total billions in revenue.

How many billions did the Microsoft lose before the division became profitable? I believe the breakdown is that Microsoft makes $7 on each third party physical game and $27 on each first party game. I doubt that Sony and Microsoft makes as much on their consoles as Apple makes selling headphones.

Well, Facebook has cash to lose. Further, VR, at least as Facebook and Zuckerberg see it, would be less about games and more about social interactions in virtual worlds. The monetization model would be different than directly selling software I reckon (most likely ads - to a hammer, everything looks like a nail). This would then be an engagement play - something Facebook already excels at.

Doesn't sound particularly feasible at the moment honestly. But you never know. I'm not writing it off at least - the people who do like VR think it's the greatest thing ever created.

So VR Second Life.

I was largely bought into the Second Life hype briefly. I certainly lived through all the brands setting up camp in Second Life.

But I'm skeptical VR was the missing ingredient. Most people don't want immersion most of the time. e.g. people hyping up VR for collaboration. I'm actually fine with video calls at least some of the time. But you're not getting me to wear a VR headset hours a day. Not happening.

That’s like the perennial “year of Linux on the desktop”.

how is Oculus Quest not viable? Have you tried it? It's pretty next level.

“Viable” isn’t about how good it is technologically. It’s about people being willing to buy it in a large enough quantity that it will be profitable.

I would assume bad leadership, even Amazon that has reportedly dubious work life balance has been able to pivot/grow but Bezos is able to lead by example and they have a lot of interesting 'ethos'. Then you have cases like Microsoft and Apple which have been around for way longer and have weathered multiple storms and computing eras. Google and Facebook just have ads, have not worked on their trustworthiness (ironically we even see posts about how real/fake are the ad engagements to this date) therefore they are stuck even if they are able to pay the salaries of the so called 'smartest' engineers (who are willing to join a one trick pony company). Microsoft built that trust by maintaining Office for the whole enterprise world (which granted, is a boring endeavor to be fixing bugs that 2-3 companies that use Excel hit but it pays long term dividends) and Apple built that trust by building easy to use consumer products that just work. Disclaimer, mostly talking about revenue streams and not products.

I keep hearing about Amazon’s bad work life balance. I have a friend who worked at Amazon in Seattle on the business side (not software development ) and he said it was brutal.

I work remotely on the consulting side. It’s about the same work life balance as I’ve had my entire career. It’s actually better than my last two jobs. At those, I had to be the “adult supervision” trying to overall their processes while juggling releasing a product and for my last job, trying to figure out ways to cut costs and increase efficiencies post Covid. I’m just a much better paid peon now.

My experimentations causing a large AWS bill is not exactly a problem now....

Anyone interested in this concept should read The Innovator's Dilemma. It covers the idea innovation suffocation within big organizations very well and is just an overall fantastic book.

Bingo. As a GSUITE admin, they are still far behind competing on the business front, and too many of their enterprise solutions are very google-specific, so few CTOs are willing to commit to them.

On the investment front, we had equity positions in Google for a while, but these days I see a lot more upside in Microsoft equity positions than Google.

And they have a long trail of abandonedware to show for it.

Having worked there the whole brilliant thing greatly overstated. Lots of mediocre engineers.

The skip ad button is designed to be pressed. It proves to Google that you’re still watching. Indeed you’re watching intently at the countdown clock. The ads front load all the content so they don’t need you to see the second half.

I'm not sure how anyone could look at what Facebook has and continues to do in the AR/VR space and claim they aren't trying to diversify.

Hiring the smartest people to do the "simplest" tasks is how you reduce errors and variance.

At some point there's a problem of comparative advantage.

You could hire a top tier genius computer programmer to check out groceries at the supermarket, and he could become the best supermarket checkout clerk in the world — but it's more efficient for him to be programming computers and leaving the grocery job to someone else, who isn't even particularly good at it, just as an entry level job.

Google's simplest tasks may be more important than many other companies' complex tasks, but in the long term, wasting capital (including human capital) by using it at a fraction of its potential is generally a losing game, for society and for the capitalist.

Google has certainly moved the needle on things like SRE--both for themselves and for the industry as a whole--because they can and do hire much of what their interview process determines is the "best" into roles that many other companies will staff with more or less whatever resume comes along.

That said, it really hasn't helped Google much to expand their business. GSuite is probably the clearest mostly organic new area--and it's pretty good. Google Cloud somewhat although, like Java for Sun, Kubernetes will probably end up making other companies a lot more money than it will for Google. Hence the current spat over Istio. Certainly lots of things haven't gone anywhere. Anyone want to lay long odds on Waymo being around in 10 years?

And it's probably not healthy for the tech industry. Yes, some will go for the startup lottery ticket for reasons of passion or naivete. And others are just less driven by money. But having many of the notionally best and brightest spending years at Google mostly because they'll pay such large wads of cash to even fresh grads means a lot of companies won't even try to compete for them.

It's also how you keep the smart people from competing against you. See Microsoft Research in the 90s.

Also increase turnover. Hiring smart, interesting people to do boring jobs just wastes everyone's time.

If you are too smart for some task then you will get bored and zone out and start making silly mistakes.

Yep, try working in a company that hires incompetent people to do mundane testing. The results are not good.

Maybe it's just that Google understands the value of testing in a way that the other companies don't.

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