Here it goes - Google started Dumping it's employees!

Changes to recruiting

http://googleblog.blogspot.com/2009/01/changes-to-recruiting.html

As we made clear during our last quarterly earnings call in October, Google is still hiring but at a reduced rate. Given the state of the economy, we recognized that we needed fewer people focused on hiring.

Our first step to address this was to wind down almost all our contracts with external contractors and vendors providing recruiting services for Google. However, after much consideration, we have with great regret decided that we need to go further and reduce the overall size of our recruiting organization by approximately 100 positions.

We know this change will be very difficult for the people concerned, and we hope that many of them will be able to find new roles at Google. They helped build this company, new hire by new hire, and we are enormously grateful for everything they have done.

Posted by Laszlo Bock, Vice President, People Operations

Changes to engineering

http://googleblog.blogspot.com/2009/01/changes-to-engineering.html

At Google we recognized early on that branching out beyond Mountain View was key to building innovative products for users everywhere. That's why we put so much effort into hiring outstanding engineers in a wide mix of countries. Having offices distributed around the globe is critical to Google's long-term success, and today we have thousands of engineers working in 40 offices in more than 20 countries. It has enabled us to make significant improvements in our products and attract more users globally.

It has also presented unique challenges. The most difficult of these being to coordinate our efforts across all geographies, and provide engineers with significant, meaningful projects that make a real difference to people's lives. Last September we asked engineers in Phoenix, Arizona to move to other offices, and the vast majority have done so. This move enabled us to build larger and more effective teams, reduce communication overhead, and give engineers increased options for future projects. Today we are doing the same thing in Austin, Texas; Trondheim, Norway; and Lulea, Sweden. Our strong desire is to keep as many of these 70 engineering employees at Google as possible. However, we do recognize the upheaval and heartache that these changes may have on Google families, and that we may not be able to keep 100% of these exceptional employees.

Our long-term goal is not to trim the number of people we have working on engineering projects or reduce our global presence, but create a smaller number of more effective engineering sites, which will ensure that innovation and speed remain at our core.

Posted by Alan Eustace, Senior Vice President, Engineering & Research

Google Is Far From Safe

http://industry.bnet.com/technology/1000655/google-is-far-from-safe/

Google is facing some “challenges,” as the corporate set says when wanting to avoid the word “problem.” Only in this case, the real concept may be “quicksand pit.” As the tech industry has seen throughout its history – including the likes of Wang, Netscape,AOL, and Packard Bell — companies can ride high one day and wind up in a ditch the next. And, as some recent developments are showing, online advertising isn’t the first industry where success is guaranteed to be everlasting.

What should spark this realization in anyone, including all those working in Mountain View at Google’s headquarters, is the story yesterday when Reuters broke that Verizon chose Microsoft to provide mobile search services on its network. (To give all their due, the Wall Street Journal had reported in November that Microsoft was close to sealing a deal.)

In any case, the race for this contract had been on for at least a year. Microsoft has stated for some time now that it thinks its future is in online advertising, and has been ready to spend to get what it wants:

Under the terms now being considered, Microsoft would share revenue with Verizon from ads shown in response to cellphone Web searches, with guaranteed payments to the carrier of approximately $550 million to $650 million over five years, or roughly twice what Google offered, these people said. Separately, Microsoft is negotiating a deal to put its Windows Mobile software in more Verizon devices. The combined value of the two deals could top $1 billion.

Whatever the final numbers turn out to be, hundreds of millions is a lot less than the tens of billions that Steve Ballmer was ready to drop for Yahoo. And if he’s interested in dominating search, this is a much more economic and efficient way of going about it for the same reason that Eric Schmidt sees Google’s future growth in mobile online advertising. It is one market that is largely untapped, and once you have a preferred provider relationship with a carrier, you have a strong (though not unbreakable) lock on searches.

When it comes to this mobile ad market, Microsoft actually enjoys a number of advantages over Google:

• Being a distant third in online search is actually a benefit, because any increase starts looking like a big improvement and helps capture momentum.
• As of September 30, 2008, Google had roughly $14.4 billion in cash, cash equivalents, and marketable securities, according to its last 10-Q. On the same date, Microsoft had $20.7 billion, according to its last 10-Q, and so has a bigger war chest.
• Only a tiny portion of Microsoft’s revenue is currently tied to online advertising, while in the first nine months of 2008; over 97 percent of Google’s revenue came from advertising.

That last point is the biggest. When economic times are hard, companies cut back on advertising. Although analysts are still projecting search ad growth through 2009, those numbers are in the low double-digits – respectable, but potentially misleading. Even if all of that went to Google, the company wouldn’t be getting near the size of Microsoft. But increasingly any increase will be the product of mobile advertising. That makes Google incredibly vulnerable if it cannot dominate the new market, and with Microsoft getting the Verizon business, it can’t.

Google has big reasons to look for diversification, which would explain the rumors of the company developing a router. Android might seem to be an answer, but remember that the company is giving it away for free, probably as a play to extend reach in mobile ad delivery. And that gets it back to needing a heavy shot of diversification.