Nothing more than an article such as this, which makes me angry : Google's effort to develop cars that drive themselves is certainly cool.
We understand the appeal of this technology: No human error, no nodding off at the wheel, faster reaction times, eyes in the back of the head, etc. We suspect that, in a few decades, when the technology can be fully developed and deployed, robot-driven cars will kill far fewer people than human-driven ones do.
But we do think it will be decades before such technology can ever be deployed in any meaningful fashion (the legal questions alone will take years to resolve, and wait until the first time one of these cars kills a kid). Of course that in itself is not a reason not to develop the technology.
But we do have to ask:
Why is Google developing this technology?
Why is Google spending the $10+ million of shareholder money per year the project consumes (15 engineers, plus drivers, plus the cars).
Isn't there something closer to its core business that Google could spend this money on?
Google Apps, for example. Google Apps are cool. But in many ways, they're still not ready for prime time. Wouldn't it maybe be better for shareholders if Google spent this money and focus on Apps instead of robot cars?
Or Chrome? Or Android? Or even search?
Larry Page, who is said to be the major force behind the robot-car initiative, is a big shareholder of Google. And if this is what Larry wants Google to spend its money on, he's certainly entitled to suggest that it do so.
But between this and Google's wind farms and sleep pods and human-powered monorails, et al, we continue to worry that the company's focus is spread too thin. And given the intensity of competition the company is facing from Microsoft and Apple, we wish it would be more disciplined. Every minute Larry and other Google bosses spend thinking about robot cars and human-powered monorails is a minute they're not thinking about how to crush the iPhone.
We also think that, if Larry is determined to perfect robot-car technology, there is a better way to do it--a way that would be better for both the robot-car technology and Google.
What's that way?
Larry should just start another company to make robot-cars. He can fund it himself. He can hire a CEO and management team and also take outside investors if he likes. The company can focus one hundred percent of its energy and resources on perfecting robot cars. And Google, meanwhile, can stay focused on its core business and other related businesses.
That's how Jeff Bezos has handled his other interests, by the way. Amazon hasn't gone into the rocket business. Another company founded by Jeff has. And this Amazon shareholder, anyway, is happy about that. The last thing Amazon needs is to be distracted from its core commerce business by the excitement of building rockets.
There are thousands of cool problems to solve in the world, and we certainly applaud Larry and Sergey for using their talent and wealth to try to solve a lot of them.
But there's a reason that every rich company in the world isn't trying to solve every one of the world's problems: Because focus matters. And Google's focus, in our opinion, still leaves something to be desired.
And this is my response -
Henry - you're completely off the mark. Agree with the others here, you're looking at this from an MBA only perspective. If you had it your way, Nokia would have still been manuacturing rubber galoshes.
Lets look at this from cost-benefit perspective though -
Costs: USD 50 mn (USD 10 mn for 5 years) if the project fails
Benefits: A multi billion dollar industry if they succeed. If they fail, the knowledge that their shareholders support them in innovating and trying out new stuff. Else they'll stagnate like MS did.
I'd anyday go for the latter option. My question is, how do you expect the world to move forward if we don't innovate? And who better to do that than someone who's changed the world once already? Why does it always have to be someone in a garage. Don't let Larry's success stop him from doing what he does best - innovating - even if it's in an entirely unrelated area. I know the financial models you'd have drawn up would balk at this. But you do remember where the company that made the Macintosh is today right? Excel models come out of your business models, not the other way round.
Entrepreneurship needs the vision and the guts to try wild stuff and to keep doing that. That is how great companies are made. And am glad Google is doing that. I wish they taught the ability to appreciate this at B-school. The world will change, come what may, we all know that. And i'd only be happy if Google leads the way.
By the way, am an MBA myself, so I think I can say with some degree of confidence, how risk averse a lot of MBAs are. When it comes to entrepreneurship and innovation that is, not derivatives!
Anirudh is currently working at Canaan Partners, India and focuses on early stage investments in technology, technology enabled and managed services businesses. He graduated from IIM Ahmedabad in 2009 and has previously worked in private equity and investment banking. If you want to discuss your business ideas or otherwise just have an interesting conversation, you can get in touch with him at email@example.com. You can also follow him on Twitter @anirudh71. Occasionally, he also blogs at www.anirudhsingh.blogspot.com.