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Google Earnings Reveal $3.6 Billion Lost On 'Moonshots' In 2016 (cnn.com)

Posted by EditorDavid on from the not-feeling-lucky dept.

Thursday Google revealed earnings results for 2016 showing the total loss for their "other bets" division had reached $3.6 billion. An anonymous reader quotes CNN : The "other bets" portion of its business includes ambitious projects like self-driving cars, life sciences research and high-speed Internet access... Alphabet shuttered a project to beam Internet to rural areas with solar-powered drones, halted the expansion of its costly Google Fiber effort, and forced Nest to cut costs and pay for its own legal and PR expenses. At the same time, the company has moved other moonshot projects closer to market. In December, Alphabet spun off its self-driving car program into a separate company called Waymo and began working on partnerships with automakers.
Google's CFO says going forward they'll "continue to calibrate the magnitude and pace of investments".

11 of 92 comments (clear)

  1. Not every single research project pays off... by StevenMaurer · · Score: 4, Insightful

    But the ones that do more than pay for the ones that don't

    News at 11

    1. Re:Not every single research project pays off... by ScentCone · · Score: 2, Insightful

      Not every single research project pays off... But the ones that do more than pay for the ones that don't

      But when pharmaceutical companies use this same approach, they are Teh Eeevil.

      --
      Don't disappoint your bird dog. Go to the range.
    2. Re:Not every single research project pays off... by Anonymous Coward · · Score: 3, Interesting

      Not every single research project pays off... But the ones that do more than pay for the ones that don't

      But when pharmaceutical companies use this same approach, they are Teh Eeevil.

      The pricing schemes of the pharmaceutical companies are the evil part of their business practises.

    3. Re:Not every single research project pays off... by ScentCone · · Score: 2

      Why? Because they know they have to make a profit or they go out of business, so they (wait for it!) look at the markets where they sell and try to make the best bet on what they can charge so they can continue to do things like spending billions on research and retain the investments needed to stay afloat in a wildly risky business? Yeah, pure eeeevil. They should definitely be nationalized and run by the government.

      --
      Don't disappoint your bird dog. Go to the range.
    4. Re:Not every single research project pays off... by ColdWetDog · · Score: 4, Insightful

      No, the pharmaceutical companies have managed to pick the the "We Do Evil" moniker because of a bunch of less-than-stellar behaviors

      - Spending more money on advertising than research
      - Pushing the bounds of advertising, both to the public and to professionals to rather dubious levels
      - Pushing the prices of older, well established, simple drugs to sky high levels - just because they can
      - Lobbying the spineless Congresscritters to keep drugs from other (actually healthier, safer) countries out of the US unless the go through a US company.

      To be sure, they aren't the only morally limited players. Congress gets big hug for the above mentioned cowardice and the inability to fund the FDA to decent levels. The Executive Branch has had it's fair share of screwball ideas (Centers for Medicare and Medicaid 'Security'). Doctors and hospitals haven't looked out for patient interests in decades. Insurance companies have never looked out for anybody other than themselves.

      And finally, Americans want Tesla healthcare at Trabi prices.

      Capitalism is a bad way to run an economy although arguably better than anything else we've played around with. But whatever it is we're doing in the US (It isn't really capitalism) isn't working at all.

      --
      Faster! Faster! Faster would be better!
    5. Re:Not every single research project pays off... by interkin3tic · · Score: 2

      Worth keeping in mind it costs on average 2.5 billion to bring a new drug to the market, and most drug candidates fail. If this were a non-essential industry, it would have folded a long long time ago. We can't allow it to fail to exist, thus we have to allow some stuff.

    6. Re:Not every single research project pays off... by badpool · · Score: 2

      Spending more money on advertising than research

      Right. You spend money on advertising as you see necessary to sell your product so you can stay in business.

      Pushing the bounds of advertising, both to the public and to professionals to rather dubious levels

      So what you're really thinking about there is the poor state of critical thinking skills in the average person who watches TV?

      You don't need to advertise health products unless you can't convince doctors that they're a healthy, necessary solution. So you make a Superbowl ad instead, utterly mislead non-doctors (i.e. the rest of us) and have them pester their doctors for a prescription.

      You're essentially blaming people for not having medical degrees. You are a complete and immoral idiot.

    7. Re:Not every single research project pays off... by BoogieChile · · Score: 2

      > And finally, Americans want Tesla healthcare at Trabi prices

      Actually, I think they'd mostly be happier with Toyota Camry healthcare at Toyota Camry prices instead of the Chevy Nova healthcare at Bentley Mulsanne prices they're paying now.

      You know, like those people who live in countries where they can have a whole baby by cesarean in a private hospital for less than the cost of a couple of Xanax.

    8. Re:Not every single research project pays off... by lexman098 · · Score: 2

      Your argument seems to be that we should pass the blame from corporations to everyone else. Yes consumers are stupid. Yes congress is way too easily manipulated by the corporations. That doesn't excuse anti-competitive, price-gouging behavior. And remember, corporations are people. They have a moral obligation to play fairly for the good of society. Don't let them fool you into thinking they'll go out of business if you don't give them everything they want.

  2. Accounting by Areyoukiddingme · · Score: 5, Insightful

    It's crap like this that's why we can't have nice things. Specifically, Google Fiber is not a loss. Accountants put it on the books as a loss, but it's not. It's just an expensive investment in physical plant with a long payoff period. It may takes years, even decades, but it's not like people are going to stop using this new-fangled thing called the Internet.

    Wall Street has been the death of American innovation. If money spent doesn't earn a profit in the next quarter, Wall Street doesn't like, it, doesn't want it, and doesn't understand it. The stock price of Tesla Motors is a fine example. Here we have a company investing hugely in physical plant, and Wall Street has no idea what to do with it, so the value of TSLA fluctuates by 50% of its value, all the time. So-called "financial analysts" don't even know how to talk about it. It doesn't fit into their neat little boxes.

    (And there's a job that's just ripe for automation. It wouldn't even take a sophisticated neural net. 90% of the financial "analysts" in the world could be replaced by some templates and a bucket of Markov chains, driven by a small shell script.)

    So Google will shut down Fiber, having utterly failed to modify the behavior of the incumbent ISPs. And we will all pay for it. And pay and pay and pay and pay... It's Comcastic!

  3. Re:Things used to be better by itsenrique · · Score: 2

    This is fascinating, but they were still greedy when they had ideas regarding core competencies. It seems more like what happens when you get so wealthy you stop thinking straight.