Google is going through turbulent times over CEO Sundar Pichai’s decision to cut costs across the company. We were first told the belt was being tightened back in August, and since then we’ve seen the “Area 120” incubation lab cut in half, a spin-off of what was left of Project Loon, the Death of the Pixel. laptop division, and the dramatic shutdown of Google Stadia. A new report from The Information details more changes Pichai’s budget cuts are making across the company, with some divisions surviving and others experiencing ominous budget cuts. There’s plenty to go over.
More Google Hardware Resources
First, we have news that aside from losing laptops, the hardware department seems largely safe. Google’s largest Android partner, Samsung, is in decline in many established markets, and Apple hit an all-time high in US market share in the past quarter. The report says Google sees Apple as a bigger problem than in the past, thanks to concerns that regulators could end the usual multi-billion-dollar Google/Apple agreement to put Google Search on iPhones. If iPhones stop running Google ads, Apple’s rise and Samsung’s demise is one of the few things that could be a major problem for Google’s revenue.
According to the report, Google yourself as the solution to this problem. To protect against what the report calls Samsung’s “further decline,” Google is “doubling down” its investment in Pixel hardware. Google apparently does this by “allowing product development and software engineering personnel working on non-Google hardware features to work on Google-branded devices.” The goal here is to stop spending more money, so Google is apparently sacrificing partner devices to focus on the Pixel division. (Making your business a Google partner seems like you’re asking for trouble, doesn’t it?)
Pichai’s Cost Savings Are Coming
So which projects are seeing budget cuts? Google TV is one of them, with the report saying, “Executives have also talked about moving some product managers working on Google TV software for television sets” to Wear OS and the Pixel Tablet. This is the only OS that specifically receives less OS development.
Much of this report seems to focus on cuts to Google Assistant support for specific form factors, which is odd because Google Assistant is more or less the same on every platform. The whole point of the Assistant is a reliable, predictable voice assistant that lives everywhere, and it’s not clear what platform-specific support should be done other than setting up an app that can receive audio and read back results. That said, the report says Google will “reduce investment in the development of its voice-activated Google Assistant search for cars and for devices not made by Google, including TVs, headphones, smarthome speakers, smart glasses and smartwatches that use from Google’s Wear OS software.” That makes it sound like a mix of more Pixel-exclusive software features and less development for software that’s purely for partner devices. In that list, Google makes TV dongles, headphones, smart home speakers, and a watch, but it doesn’t make a car.
Frankly, Google Assistant seems to be the hardest hit project in this report. On the one hand, that’s hard to believe, since Assistant is really just “Google Voice Search” and search is Google’s second-favorite product (after ads). On the other hand, it has never been clear that Google Assistant makes money. The Google Assistant never reads you an audio ad and you never see an ad of the answer it returns. Only if the product fails and takes you to a Google search results screen will you be able to see an ad. Google has used the assistant monetization options in the past, but I don’t think any of them ever got off the ground.
Some hardware companies still prefer?
While Google will focus on its own hardware, the report says it isn’t completely cutting off existing hardware makers either. The report says that “Google has picked Samsung and the Chinese brands OnePlus and Xiaomi as premium Android phone partners for which it should develop the best Google services. But that leaves a long list of other manufacturers that may not get the same attention from Google. groups like the assistant team.”
Picking favorite hardware manufacturers is a lot like the recent rollout of Wear OS 3. That operating system was a Samsung exclusive for a year, leaving smaller OEMs like fashion brand Fossil out in the cold. When it came time to launch the Pixel Watch, Google built an exclusive Fitbit app for itself and never ported its public fitness project, Google Fit, to the new Wear OS 3. This week, the new Fossil Gen 6 watch finally arrives. launched with Wear OS 3, but now it doesn’t have a Google fitness solution. those watches also don’t have the Google Assistant anymore, as Google didn’t prioritize development of the Wear OS 3 Assistant on the slower Wear 4100 SoC that comes with Fossil watches.
We’ll be keeping an eye on the actual, practical results of these changes, but Wear OS is already showing a focus on Google hardware, a prioritization of certain partners, and dismissive Google Assistant support for others. Everything in this report is already happening. The biggest weakness of Google hardware is probably the very small list of supported countries, but that just increased slightly with the launch of Pixel 7.
