Google and Its Cost Cutting: More Than Meets the Eye
April 24, 2020
DarkCyber is pleased that CNBC continues to write interesting news stories. In fact, this write up only mentions Covid twice, a new record for news associated with talking head video. “Google to Cut Marketing Budgets by As Much as Half, Directors Warned of Hiring Freezes” reports:
Google is slashing its marketing budgets by as much as half for the second half of the year, according to internal materials viewed by CNBC. One email about the cuts went out to marketing employees this week, noting the budget cuts and a new hiring freeze for full-time and contract employees.
The now standard unnamed sources and no picture of the “documents” the canny CNBC news sleuths were able to read.
Let’s assume that everything in the write is accurate. Let’s ask some questions which are not addressed in the scoop:
- What’s the connection between Google’s giving away free product listings in Google Shopping and this new austerity?
- What is the increase in data center and bandwidth in the last three years? Why has Google’s CFO been unable to trim or stabilize these costs?
- What will Google do to hold back or flatten the ad losses to Amazon and Facebook?
- What are the direct costs associated with Google’s new found sense of responsibility for problematic content in ads and in YouTube videos?
DarkCyber’s analyses suggest that Google is now suffering from more than two decades of mismanagement. My research team calls this style of running a company the high school science club management method of HSSCMM. The idea is that decisions made without context or sufficient wisdom have created a machine that devours available cash.
On the surface, Google is Googley. But beneath the surface are indications of stress. There are employee pushbacks. There is interesting management behavior in the legal department. There is a palpable sense of vulnerability to Amazon and Facebook.
Googzilla is starting to shiver because there are more innovative, aggressive predators sniffing around the happy campus in Mountain View.
The reaction? Innovation, happy employees, bug free services, relevant search results, easy to use products like Google Maps?
Nope.
Fire people in marketing. Once the lawyers were housed in trailers “off campus.” Now another non engineering group is sacrificed to feed the maw of tough to control technology costs. Sacrifice the marketers.
Stephen E Arnold, April 24, 2020
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