There is no shortage of speculation among punters and pontificators on what it will take to undo the great Google behemoth. But I thought this recent article from Bob Cringley takes an interesting tack.
He basically argues that Google's strategy of hiring the best and the brightest -- while a key source of strength to date -- will also be the company's undoing. Everyone knows that Google is all about harnessing the power of innovation among its incredibly over-qualified workforce, allowing employees to spend up to 20% of their time on pet projects. The flaw in this approach is that it is not sustainable -- over time these employees will be frustrated that the vast, vast majority of their projects are never adopted and commercialised. Combine this frustration with the vesting of their stock options, and they will be highly motivated to jump ship to launch their own businesses, perhaps to compete with Google.
I'm not so sure that the frustration of unadopted pet projects will be as big a driver for engineers to leave as Cringley does, but I do think Google will have a growing retention problem on its hands as the first large waves of stock options vest. Keeping so many hyper-bright people motivated is a mammoth task, and doing it while maintaining the kind of commercial focus required as a public company is doubly hard. At some point Google will either have to accept losing some of those brains in favour of staying focused, or it will lose its focus by innovating in too many directions at once.
On the positives, either outcome is great for the industry as a whole and for consumers. Google is basically funding the largest Internet R&D effort ever. Think of it this way: in 2006, Google spent $1.2bn on R&D. If its engineers are using on average 20% of their time to work on non-core projects, then as much as $240m was spent on random research. Based on Google's history, this year the figure is likely to be closed to $500m. That's a lot of of seed funding for new ideas...