Apple has failures. Amazon has failures. Google has failures. Go down the list. Facebook, too. With few exceptions, nearly every acquisition Google has made through the years has died. Is there an exception to the rule?
Every tech company with any measure of success and money in the bank wants to diversify. Look at Apple’s product line. Five major revenue and profit streams– iPhone, Services, Mac, Wearables, iPad. Where does Google get about 90-percent of its revenue and profits? Microsoft?
Not. From. Hardware.
Google is a very rich advertising company that wants to invent the future of technology but cannot figure out the hardware component. One Apple engineer is on record saying, “Hardware is hard.” Indeed.
Since 2001, Google– and in this case, Google is synonymous with parent company Alphabet– has acquired over 200 companies.
Can you name one? By far, the most successful in terms of return on investment has been YouTube. $1.65-billion was a bargain. Motorola may have been the worst. $12.5-billion. Then, there is Nest at $3.2-billion, and a long line of other acquisitions which have fared poorly.
It isn’t just hardware, of course. Google has an even longer list of software projects that died on the vine; launched as Beta propositions but that never caught the user fancy of Facebook or Instagram folks.
The latest is Fitbit; a mere $2-billion or so. Why? Google still wants to be like Apple. Yes, Apple is a hardware company. Apple Watch and AirPods– running mostly on Apple iPhone only– own the premium wearables section where Google wants to make a dent.
How has that worked out?
Google makes more money from iOS than from Android. Google’s hardware efforts are failures. To date. Google Fitbit will get the company back in the wearables game, right?
Google Glass? Touché!
We can criticize Apple for milking all the profits from a product segment, but that’s the nature of business. We live in a capitalist world. Everybody is out to get your money. That means Google wants more money and the only way it can figure it out is to be more like Apple, and that means hardware.
Why do so many Google, Microsoft, Amazon, and Facebook hardware projects die?
Hardware is hard.