Google Becoming Too Big For Itself?

    May 13, 2008

Fortune magazine has one of the most comprehensive "Google’s starting to fall apart" articles, I’ve seen in a long time.

Sure, it’s easy to suggest that Google has become too big, too arrogant, and has lost its original focus, but Fortune’s (long) article does a great job digging down and explaining why many are saying just that.

There were two things that really stuck out to me.

First, even Google’s biggest partners are concerned that the company is a one-trick (AdWords) pony.’s Marc Benioff puts it perfectly:

"What they need to do is build a full portfolio of revenue, as Microsoft has," says Benioff. "They have a fantastic cash cow. They need a goat and a chicken."

Second, the company is having trouble retaining its top talent. It seems Googlers would rather leave the company and struggle with a start-up, than use their 20% time to help Google find new revenue channels. More concerning is the apparent nonchalance of CEO Eric Schmidt:

"We’ve been hiring on the order of 100 people a week," he says. "So in one week we hire more people than the people you just named."

Wow! Yeah, but the people you lost include your CIO, CFO, head of ad sales, and its head of PR. Doesn’t that concern you Eric?

Google faces the huge issue of scaling its business. At it grows, it becomes less able to retain the "start-up" attitude that made it so successful–which is why Googlers would rather go it alone.

Last word goes to "Dean" who sent me the Fortune link and has this to say…

"I use this as exhibit A in my argument that Google will never see $2,000/share…or anywhere close. They are a big boy company now whose biggest challenge might be itself. Unfettered growth along with an unstructured culture will ultimately lead to a whole lot of inefficiency – my own experience at [a start-up] showed that unmanaged growth is the pathway to failure. With the 20% rule they are practically begging top talent to incubate their own start-ups and leave. All of this will lead Wall Street to put their foot down and demand that Google fall in line. I.e. Contain costs, drive efficiency, and steer away from unprofitable ventures. Not sure when tat will happen, but it will be sooner rather than later."