Tech Talk: Google's Pet Projects Are Flopping

Back in October of 2015, Google reorganized into Alphabet. The internet giant mostly did it to give their smaller ventures all of the benefits of a startup, as well as to break up their monolithic company to avoid the ire of shareholders, antitrust staffers and other companies in the same sector. While still Google at the core, Alphabet has become a large number of diverse companies, all of which have Google's blessing and unique talent and innovative spirit. Problems ranging from rural internet to death itself are on the menu to be tackled, but there's one big problem the company seems to have that only one division is really solving. That problem is, in a word, money.

Google's core internet business, search and advertising, is making a ton of cash. The company was, for a time, the most valuable company in the world. Alphabet is not in dire financial straits by any means, and it has Google to thank for that. The problem is that it's almost exclusively Google that Alphabet owes its gratitude for continued financial relevance. Just about every venture that Alphabet has gotten involved with has either outright flopped or is making barely enough money to stay afloat.

For exhibit A, we can look at the legacy of Boston Dynamics. One of the foremost names in America on robotics, Boston Dynamics had a decent military contract and was cranking out new bots fairly often. After Google bought them and eventually reorganized into Alphabet and turned them loose to their own devices, they began to decline. First, their progress on new automatons basically ceased. Before long, they lost their military contract due to a lack of development that would make their robots practical for typical military recon operations, requiring stealth, longevity and toughness. Recently, Alphabet began debating on the possibility of selling Boston Dynamics. Chalk up a flop.

Exhibit B crashed just as hard as Boston Dynamics, if not harder. When Google bought up Nest, it was a somewhat promising company with a nice connected thermostat as its flagship product. Its REVOLV home hub, bought from another company, was also selling quite well. When Google bought them, they almost immediately spent upwards of $500 million to buy Dropcam and re-release its main product as a re-brand, which ended up flopping. They also quadrupled their employee count, still failing to turn out much in the way of new products. They remotely bricked all Revolv home hubs and wound up issuing refunds for them, an embarrassing and expensive gaffe that cost them big. From there, it didn't take long for word to hit the street that, amid requests to "sell Nest" and even employees mocking the company, CEO Tony Fadell was on the way out, off to check out other opportunities. Naturally, word on the street was that he had been canned. In any case, Nest is currently languishing and continues to hemorrhage money at an alarming rate, despite the new CEO sending out assurances that Nest is not for sale. For now, chalk up another flop.

On top of the outright flops, most of which are Alphabet's purchases and ventures, there are many projects that have yet to make them a dime, by pushing other services or otherwise. While some that are meant to push the Search business along have somewhat done their job, such as Project Loon, Google's self-driving car unit has been in the game for years and has yet to have any commercial product to show for it, small gains from investments and contracts aside. While this division could make good money in time, it's a cost sink, for now, and Alphabet can only hope it will pay off. Calico, Google's anti-aging life science division is looking to cheat death, but that mission is not a cheap one, nor is it terribly profitable. As with the self-driving car business, this one could make decent money in the future, but will continue to eat funding until something gets released. Another Alphabet side project, Google Glass, crashed spectacularly and is now only sold in very limited quantities in Enterprise, with its Project Aura revival still far off and requiring significant time - and money - to become viable.

It hasn't all been doom and gloom outside of the Google flagship, of course. Some projects have managed to make it off the ground and get some cash under their belts, though shareholders are still worried. Spotlight Stories have made a name for themselves and furthered Google's ad business, Project Ara is finally nearing a commercial release to consumers, and Project Tango, now known simply as Tango, has hit the ground running. If these projects continue to make money alongside the flagship business and some of the ones in waiting to start making good money actually begin drawing a payday, Alphabet could reverse its fortunes. For now, analysts and shareholders are left scratching their heads.

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About the Author
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Daniel Fuller

Senior Staff Writer
Daniel has been writing for Android Headlines since 2015, and is one of the site's Senior Staff Writers. He's been living the Android life since 2010, and has been interested in technology of all sorts since childhood. His personal, educational and professional backgrounds in computer science, gaming, literature, and music leave him uniquely equipped to handle a wide range of news topics for the site. These include the likes of machine learning, voice assistants, AI technology development, and hot gaming news in the Android world. Contact him at [email protected]
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