Former Alphabet Executives Skeptical About Its 'Other Bets'

Former Alphabet executives and employees are skeptical about the company's "Other Bets," Reuters reported on Tuesday, citing interviews with dozens of ex-Googlers and other people who have previously worked at some of Alphabet's divisions. The Mountain View, California-based tech giant reorganized itself and adopted a holding company structure in 2015 in an effort to separate its flagship Internet search and advertising business from its growing but still extremely risking ventures that were all categorized under the aforementioned term. Those secondary operations that include the likes of Nest and Verily have lost $855 million in total in the first quarter of this year alone, in addition to accumulating $3.6 billion in losses over the course of 2016, Alphabet's recent financial reports have revealed.

The tech giant's ventures unrelated to Google are now seemingly being downsized, with the company recently agreeing to sell its robotics subsidiary Boston Dynamics to Japanese SoftBank and essentially halting the expansion of Google Fiber. Alphabet's Nest was also close to being sold last year, people familiar with the matter said, without disclosing what made the deal fall through. Industry insiders claim that this business strategy shift that saw the firm do its best to limit its riskier ventures was primarily led by Alphabet's current Chief Financial Officer Ruth Porat who also played a large part in the company's 2015 restructuring.

The current corporate structure sees chiefs of the tech giant's Other Bets meet with its Board of Directors approximately once per quarter, which is when they discuss general plans and funding, though they're still given a high degree of autonomy, former employees said. This setup is meant to allow for innovation and prevent the company from stagnating while still providing it with some control over its subsidiaries, though it's currently unclear whether that approach is working, with Other Bets still losing money at a worrying pace and management priorities continuing to shift. Two ex-employees of Nest claimed that the firm that Alphabet was reportedly on the brink of selling last year was promised significant funding when it was acquired in 2014 but ended up being pressured to put a focus on revenue following its parent's restructuring. While it remains to be seen whether Alphabet's relatively new corporate model ends up yielding significant success outside of Google's realm, more details on the matter will likely be available in the coming months.

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Dominik Bosnjak

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Dominik started at AndroidHeadlines in 2016 and is the Head Editor of the site today. He’s approaching his first full decade in the media industry, with his background being primarily in technology, gaming, and entertainment. These days, his focus is more on the political side of the tech game, as well as data privacy issues, with him looking at both of those through the prism of Android. Contact him at [email protected]