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Comment by whoisthemachine | Hacker News Reader

Google making baffling decisions is hardly news these days. The main decision driver at Google is whether that resource/product improves ad revenue. I have a hard time seeing how Google Cloud would drive ad revenue, which likely means leadership at Google doesn't either.

I just wish Google's leadership would stop starting projects (and hiring smart people to develop those projects) when they know the projects will not drive their goal of more ad revenue.

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Big companies pay millions to GCP, surely that is seen as its own revenue source? I don't see anything that would make want to use their search either after using their cloud stuff.

Should the Cloud division live under Alphabet or Google?

Admitting they're just an ad company would collapse the delusion that drives their share price.

Everyone 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

You could probably make a stronger point without an attack like this.

edit: removed my quote of the attack since OP did.

Good point. Edited

Once 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.

First you loose the ability to build things and then you loose the ability to buy good things instead of crap.

Long 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?

Alphabet trades at a P/E of 27, hardly delusional.

During 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.

The 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.

When 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%

It'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.

This 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.

I 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.

AMP 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.

I 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.

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