Shulou(Shulou.com)11/24 Report--

According to news on March 3, tech giants such as Google, Meta, Microsoft and Amazon have had many ambitious so-called "moon landings", long-term planning projects with long cycle, large investment and slow money, such as drone delivery and extending human life. However, as the pressure to cut costs grows, many risky projects that require more patience have been downsized or even shut down. The era of "moon landing" in Silicon Valley is coming to an end.

Eight years ago, Google co-founders Larry Page (Larry Page) and Sergey Brin (Sergey Brin) announced that the company would be split into separate entities and named its parent company Alphabet. The idea was to separate Google's core business (advertising) from secondary projects that took time to ferment but could become Google's new cash cow in the future.

However, these "cash cows of the future" have not yet been successful, and Google still relies on advertising for the vast majority of its revenue. Google has shut down most of its so-called moon landings, including Internet balloons and contact lenses that measure blood sugar. Even Waymo, the most closely watched self-driving car project, and Verily, a medical technology start-up, are now subject to similar restrictions on conventional business.

Waymo announced a second round of layoffs on Wednesday local time, cutting a total of 8 per cent so far this year. Waymo's layoffs are just the latest example of the new reality facing big technology companies, that the era of "moon landing" is over.

As the decade-long bull market faltered and the prices of technology stocks fell throughout the year, there was growing pressure on Wall Street to cut costs. In the past few months, a wave of layoffs and cost-cutting has swept Silicon Valley. Ambitious projects that are supposed to be the backbone of future revenues have been particularly hard hit, some of which have been slashed while others have been abandoned altogether.

Roger McNamee, a veteran venture capitalist and early investor in Facebook, said: "these big tech companies used to think that everything they were exposed to was useful, but that's not the case. Rising interest rates mean that investments needed to keep spending on lossmaking projects are becoming harder to find, and big technology companies are tightening spending to protect their core businesses. So I think you will see them cutting back or even abandoning their moon landing plans one after another. "

For these companies, giving up their dream of landing on the moon marks another stage in their middle age. In the 20 years after the millennium, Google, Facebook and Amazon have all grown rapidly from startups to technology giants, breaking the balance formed by their previous companies.

The spirit of "acting fast and breaking the rules" and billions of dollars of venture capital provided by Silicon Valley investors have helped them grow into industry giants on their own strength. But for founders who start businesses in dorms and garages, subversive threats from new start-ups are also present all the time. With that in mind, creating room for adventurous, eccentric and overly ambitious ideas is the perfect solution for avoiding the stagnation of previous generations of big companies.

When Google went public in 2004, Page and Brin sent letters to potential investors warning them not to focus solely on financial performance, as most other listed companies do. They created the research laboratory Google X, focusing only on the weirdest and most adventurous ideas. Page and Brin also told employees that they should spend part of their time on projects that have nothing to do with their day-to-day work.

"Google is not a traditional company and we are not going to be one of them," Page and Brin wrote in the letter. " Page repeated the same phrase when he announced the establishment of Alphabet Holdings in 2015.

It is true that these tech giants have succeeded in repelling many disruptors, but they do not always reinvent themselves with great ideas created internally. Apple, Amazon, Google and Facebook have made hundreds of acquisitions over the past 20 years, targeting both sizeable and promising potential competitors and many small startups. Google's Android operating system, Facebook's mobile advertising business and Amazon's audiobook empire were all originally acquired.

Last October, a month before the announcement of mass layoffs, Amazon began to phase out its internal incubator, Grand Challenges. It was reported in 2018 that the team was so mysterious that employees were even asked not to reveal their names. The team participated in projects such as Amazon's first smart glasses, the Echo Frame, and cancer research.

Team leader Babak Palvitz (Babak Parviz) joined Amazon from Google X in 2014, but left last October. It is reported that most of the team's projects will be shut down, including Amazon Glow, a projector for children, and Amazon Explore, a virtual tourism product.

Amazon also shut down telemedicine company Amazon Care, a product incubated by Grand Challenge, last August. Instead of continuing to support the project, Amazon bought startup One Medical.

Andy Jassy succeeded Amazon founder Jeff Bezos as chief executive in 2020. Bezos is known as a visionary adventurer, while Jassi, who runs Amazon's cloud computing division AWS, is known as a pragmatic businessman.

Bezos regards the courage to experiment and maintain bravery (the so-called first day mentality) as a core part of the company's culture. But former employees who have worked at Grand Challenges say Amazon's corporate culture has changed in recent years. "is Amazon not only growing, but also getting older? it's like entering the second day of starting a business," he said.

Despite the heavy investment, many of Amazon's most ambitious projects have not been successful. Bezos made headlines in 2013 when he announced that Amazon had tested a drone delivery service. But a decade later, Bezos has left, and Amazon's drone business is stuck in regulatory red tape and offers few real delivery services.

'Economic pressures do affect the funding of the lunar landing lab, but that doesn't mean the spark of innovation will disappear within the company, 'said technology entrepreneur and investor Peter Dimandis. He founded the X Prize Competition in the mid-1990s to encourage private companies to develop spacecraft, an area that was still largely dominated by governments. "We will see that the rise and fall of these lunar labs depends on the profitability of companies, but this culture will never disappear, because these companies were born in the same way," he said. "

Google's Waymo is not the only moon landing that has been hit by recent layoffs. Verily is one of the few health-care-related projects launched by the company over the years, covering a range of themes, including cultivating infertile mosquitoes to reduce insect-borne diseases and helping to run novel coronavirus testing centres in the early stages of the outbreak. When Google announced layoffs on January 20 this year, Verily was significantly affected, cutting 15 per cent of its workforce.

Area 120, the incubator of Google's internal startups, has also lost most of its staff and will soon be completely shut down. The division was once seen as one of Google's hallmarks because it allowed employees to spend time on projects outside their regular work, sometimes even staying at the company to start start-ups. But now it seems that those days are gone forever.

"larger, more mature companies have greater legal liability, which makes it harder for them to launch new products and keep up with start-ups," says Mr Diamandis. "it's a really difficult challenge for large companies, and it makes it harder to innovate, seize real opportunities and resist risks."

Similar scenes have been unfolding over the past year, such as the recent explosion of generative artificial intelligence (AIGC) tools that can produce text, images, sounds and videos that look and feel like human creation. Startups such as OpenAI and Stability AI have brought their products to the public, attracting a wave of marketing attention and surprising people with these new tools. But in fact, most of the technology used by these tools comes from the ideas of large technology companies earlier.

Microsoft has spent billions of dollars in a deal with OpenAI to use the latter's technology in its new Bing search chat robot. Google and Facebook are eager to launch their own similar technology and break through the guardrail set up in the past to ensure that the powerful technology is safely used before it is introduced to the public.

Meta, the parent company of Facebook, is still investing billions of dollars in long-term bets to build an immersive digital world known as meta-universe, although it has made slow progress in attracting users. According to CEO Mark Mark Zuckerberg, virtual reality and augmented reality technology-driven services will be the next great computing platform as people work, play and shop through their avatars in the virtual world.

But even Zuckerberg is being forced to cut costs and refocus existing employees on the company's top business goals to cope with falling revenue and uncertain economic prospects. In the past year, Meta has cut investment in a number of products and services, or even stopped development support altogether, such as Facebook news tags, communications product Bulletin and video calling device Portal.

Earlier this year, Zuckerberg declared 2023 to be a "year of efficiency" and promised to streamline management and speed up company decision-making.

This is seen as a major cultural shift in the technology industry. In the technology industry, employees jump from high-paying jobs at big tech companies to riskier start-ups, taking it for granted that if small companies don't do well, they can come back. But McNane said: "I think that idea is being tested. If people working in Silicon Valley become more risk-averse, the impact will be far-reaching."

Welcome to subscribe "Shulou Technology Information " to get latest news, interesting things and hot topics in the IT industry, and controls the hottest and latest Internet news, technology news and IT industry trends.