The hardware advertising business is beginning to fail. How can Google get rid of these anxieties?

In addition to the well-known Google company (search, Android system, YouTube and other Internet services), there are Calico company, an investment company, Google Venture (now renamed GV), Google Capital, an internet service company, Access and Energy, and a medical technology company, Life Sciences (now renamed Verily).

But apart from the name, Alphabet has not changed anything compared with the original Google: eric schmidt, the two founders and former CEO of Google, is still in power, and the financial statements in March will not disclose the income of its subsidiaries until January 216.

Similarly, 9% of Facebook's revenue comes from advertising. Facebook's natural user social data and the rapid pace of mobileization have made Facebook's global digital advertising revenue ratio rise from 8% last year to 9.6%. Whether it is display advertising or mobile advertising, Facebook's share is rising, while Google's is falling.

Accessing websites from search engines used to be the first thing people did when they turned on their computers, but this habit disappeared on mobile phones, and one application after another replaced search engines as the main entrance. From the search box to the application, the shift of attention makes the advertising space targeted by advertisers change accordingly. In the App Store app store in the United States, only Youtube belongs to Google, while Facebook has four (Facebook, Messenger chat app and two Instagram apps).

But as the advertising model of easy money comes to an end, Google has started a series of adjustments. In March of this year, Google hired Ruth Porat, who had worked for Morgan Stanley for many years, as its chief financial officer. Porat has done many things to improve Google's profit margin: it is as small as reducing the number of recruiters and imposing more restrictions on employees' expenses that cannot directly bring in income, such as business trips and activities; Big enough to buy back stocks to cater to investors.

reorganizing Alphabet is the final solution. On the one hand, the new company will eventually further open its books to let investors know more about the operational details of different businesses. On the other hand, the CEO of each subsidiary has a high degree of independence and autonomy on the premise that these subsidiaries will leave the wings of Alphabet one day and go to the business world to face challenges and prove their existence value.

"Scarcity of resources is a catalyst to stimulate creativity"-How Google Works, co-authored by Schmidt and Jonathan Rosenberg, describes forward-looking projects in this way, because "excessive investment will lead to stubborn prejudice. At this time, people can only see the positive side of those projects that invest a lot of resources, but can't make sober decisions."