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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".

1 of 92 comments (clear)

  1. 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!