Yesterday Google announced that it was restructuring it’s whole company into multiple subsidiaries under a new parent firm called Alphabet. What does this mean for users of Google’s myriad products and the group’s ability to innovate?
Now that each individual product is effectively a separate entity we’re betting that their will be a stronger emphasis on financial returns from each. Historically, the search advertising revenue has butressed all other products keeping them free or cheap for consumers and keeping their developers more free to innovate.
We think there will now be pressure to earn more revenue from products such as Calendar, Drive, Gmail, Analytics, etc. We also think that there will be less emphasis on investing higher-risk experimental products like Wave, Buzz, Google Plus, etc and more inclination to buy in good ideas in the same way that Microsoft does.
Google is looking more and more like a utility and less like a skunkworks.