Alphabet Inc (Google) Class A

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GOOGL
Alphabet Inc (Google) Class A NASDAQ
 
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History of GOOGL

Important events

Oct 082021

Google invests $1 billion in Africa

Google invests $1 billion into start-ups in Africa, a commitment that includes a new subsea internet cable.

Google is increasing its investment into Africa, injecting $1 billion into an Africa Investment Fund, which aims to give start-ups access to the internet. Part of the fund will also be allocated to low-interest business loans for small companies in certain African countries. Google CEO Sundar Pichai said:

Increasingly, we are seeing innovation begin in Africa, and then spread throughout the world. For example, people in Africa were among the first to access the internet through a phone rather than a computer, and mobile money was ubiquitous in Kenya before it was adopted by the world. This momentum will only increase as 300 million people come online in Africa over the next five years.
Oct 062021

Google’s AI investment is paying off

Google’s huge investment into artificial intelligence (AI) is starting to pay off, and its AI unit DeepMind turned its first ever profit last year.

Google first acquired U.K. artificial intelligence start-up DeepMind in 2014 as a way to compete with the growing list of tech companies that had begun investigating deep learning – and its purchase is starting to pay off. After losing around £500 million in 2019, DeepMind made its first ever profit last year – revenues have tripled from last year to £826 million.
Oct 042021

Is Google dropping out of the fintech race?

Looks like tech giant Google is retreating from its efforts to make a name for itself as a dominant player in the financial services space, cancelling its plans to offer bank accounts to its customers. Google first revealed its ambition in 2019: claiming that its digital wallet, Google Pay, would allow customers to open a checking account through the app in partnership with financial institutions CitiGroup and Mastercard sometime in 2021. However, it looks like the tech giant is going a different direction now, potentially to make space for its burgeoning Cloud unit, and has abandoned its plans. The move comes not long after one of Google Pay’s key executives left the company, stirring up rumors of missed deadlines and delays in the project. Google said:

Our work with our partners has made it extremely clear that there’s consumer demand for simple, seamless and secure digital payments for online and in-store transactions. We’re updating our approach to focus primarily on delivering digital enablement for banks and other financial services providers rather than us serving as the provider of these services.

Big tech across the board has been invading the consumer finance space for a while now. Amazon (AMZN) has already added lending, payments, and insurance features to its services among others, and has suggested plans to offer a checking account (though nothing has materialized on that front yet). Apple (AAPL) launched a credit card in 2019; while Facebook previously (FB) tried its hand in the world of fintech with its (also cancelled) Libra currency.

While Google is scaling back its banking efforts, it's concurrently ramping up its Cloud-based effort to challenge Amazon (AMZN) in the blockchain/developer space. Google is making sure that it will be a leader in the next generation of the world wide web and joined forces with Dapper Labs earlier this month to power a blockchain-based web service. Google’s cloud unit also just expanded its collaboration with chip maker AMD (AMD) to ensure faster application performance on the platform.
Mitchell Luo
Sep 222021

Big tech might be about to get some big new rules

Russia has been cracking down on Google and Facebook as a way to limit access to information online, and big tech might now face amends of 5% to 20% of their revenue.

Big Tech has gotten itself in the bad books with Russian internet regulators after refusing to delete content deemed “illegal” by the government. As political unrest in Russia rises, so the government is working hard to take power away from social media platforms that help people organize, and a government statement says:

For a number of companies that have systematically refused to comply with the agency’s legal demands, the issue of fines on revenue is being considered in the near future.
Sep 152021

Google hops on the NFT train

Not one to be left behind by a trend, Google gets involved in the burgeoning NFT market by teaming up with Canadian blockchain company Dapper Labs.

Google joins a growing list of companies to enter into the world of blockchain by inking a deal with blockchain platform Dapper Labs. The Canadian-based start-up is the creator of the Flow blockchain, and Google will help Dapper to help scale the platform – which is home to a whole ecosystem of non-fungible tokens. All of this is in an effort to power a blockchain based world wide web.
Myriam Jessier / Unsplash
Sep 132021

Google gets worried over Apple's Epic ending

A federal judge rules in favor of Epic Games in its battle against Apple, causing Google to drop 1.86% on worries for the future of its own App Store.

Alphabet is in the throes of an antitrust battle against Android app makers, led by Epic Games, which is protesting against the company taking 30% commission on sales – and a ruling on Friday is a cause for concern. A federal judge ruled that Apple (AAPL) has to let apps tell their users about alternate payment methods and take them to external sites, circumventing commission charges.

Google’s own trial is over a year away, and while Epic failed to prove Apple (AAPL) is a monopolist, they now have plenty of time to hone their case.

Prices dropped to their lowest since the end of August, down 1.86% to $2817.52.
Sep 032021
🎧

YouTube Music turns it up

Alphabet’s YouTube is stepping up its music game with a 50 million subscriber base on its paid music streaming services – up 20 million from last year.

The music streaming market is a fiercely competitive one, dominated by giants like Spotify (SPOT), Apple (AAPL), and Amazon (AMZN) – but YouTube Music is planting its flag in solid ground after it reported passing the 50 million paid subscribers milestone. Numbers are up over two thirds since October last year, when the service reported only 30 million subscribers. Spotify (SPOT) boasts around 165 million subscribers, while Apple (AAPL) and Amazon (AMZN) have around 78 million and 63 million respectively, so YouTube is definitely in the game. Industry consultant Mark Mulligan from Midia Research says:

(Youtube Music is) becoming to Gen Z what Spotify was to millennials half a decade ago. Google’s YouTube Music has been the standout story of the music subscriber market . . . resonating both in many emerging markets and with younger audiences across the globe.
Sep 012021
🇰🇷

South Korea drops the hammer on big tech payment policies

Big tech is facing regulatory backlash from South Korea, which just became the first country to ban Google’s developer payments policies.

Google and Apple’s (AAPL) payments policies force developers to only use the company’s proprietary billing system, which takes a commission of up to 30%, and the policies have been a source of much contention between big tech and regulators. Now, South Korea’s parliament has become the first to pass a bill that will ban those policies, meaning developers can redirect users to alternate payment platforms and avoid paying commission. Naturally, Google isn't too pleased:

(Our service) helps keep Android free, giving developers the tools and global platform to access billions of consumers around the world. We’ll reflect on how to comply with this law while maintaining a model that supports a high-quality operating system and app store, and we will share more in the coming weeks.

The new laws set a radical precedent for sanctions on the lucrative service that could hugely affect Google’s revenue – with a real-world example of restrictions, who knows where else in the world will follow suit. Omdia analyst Guillermo Escofet, who specializes in digital consumer platforms, said:

This could presage similar actions elsewhere. The overriding political mood has become hostile to the enormous amount of power concentrated in the hands of the tech giants.
Aug 172021

Google teams up with FB... underwater

Industry behemoths Google and Facebook team up to build a giant underwater cable that will improve internet access in the Asia-Pacific region.

Alphabet’s Google and social media giant Facebook (FB) have joined forces to bring their tech prowess to Asia-Pacific, with plans to build a 7,500 mile cable under the sea connecting Japan and South-East Asia. The new project, which is called “Apricot,” will see thousands of miles of undersea internet cable laid between Japan, Taiwan, Guam, the Philippines, Indonesia, and Singapore, and is due to come online by 2024. Facebook (FB) has offered to fund part of the project, along with a group of regional telecom providers.

Google and Facebook (FB) have partnered on similar projects before, already laying thousands of miles of cable at the bottom of the ocean together, with new plans in the works to fund two further cables between Singapore and the U.S. West coast.
Image: Yannis Papanastasopoulos / Unsplash
Jul 282021

Q2 earnings give investors Google-y eyes

Google’s parent company Alphabet crushes its second quarter earnings, reporting impressive digital ad sales numbers that jumped 69% from the year before.

Alphabet reported impressively robust earnings from the quarter ended in June, going from strength to strength even as regulatory sharks circle and wowing with its digital ad sales numbers. The industry beat on both the top and bottom lines in a big way, reporting earnings per share of $27.26 on revenue of $61.88 billion, compared to expectations of $19.34 in earnings per share on $56.16 billion in revenue.

Google ad revenue was the star of the show, further cementing the company’s status as the world’s leadest advertising engine – the segment pulled in $50.44 billion, up 69% from the same period the year before when COVID took its toll on companies everywhere, and representing around 81% of Alphabet’s revenue. Retail advertising was by far the largest contributor to that growth, with segments like travel and media seeing the biggest jump. The advertising behemoth is on the way to finishing the year with just under 29% of the global market.

Ad revenue may have been the star of the show, but there were some strong back-up dancers to boost the report. YouTube advertising revenue was up 84% at $7 billion, and its Cloud revenue brought in $4.63 billion, up 54% from the year before and slightly above the number Microsoft (MSFT) posted for its cloud unit Azure. Granted, the year-before comparisons are based on a quarter that saw Alphabet crippled by COVID, but the numbers are impressive nonetheless.

In Q2, there was a rising tide of online activity in many parts of the world, and we’re proud that our services helped so many consumers and businesses. Our long-term investments in AI and Google Cloud are helping us drive significant improvements. Our strong second quarter revenues of $61.9 billion reflect elevated consumer online activity and broad-based strength in advertiser spend,

said Ruth Porat, CFO of Google and Alphabet.

Prices ended Wednesday up 3.18%.
Jul 082021

Washington takes aim at Google

As one big tech antitrust case wraps up, another unfolds. Thirty-seven states have banded together to sue Google for alleged antitrust violations in its Android app store.

DC has got big tech in its sight, and it's not taking its finger off the trigger now, despite a string of lost lawsuits against the tech giants that seem to be slowly taking over the world. The ink is barely dry on the recent dismissal of antitrust cases against Facebook, which the judge deemed to be lacking in evidence, and already a bunch of U.S. states and district attorneys general have gotten together to take aim at Google. The litigants are claiming that Google bought off competitors and used cleverly restrictive contracts to maintain a monopoly for its app store on Android phones.

Epic Games, which is coming to the end of a lengthy court battle with Apple over accusations of similar anti-competitive behaviour (we haven't got a ruling yet, stay tuned), also filed a suit against Google last year, accusing the PlayStore of orchestrating an unlawful monopoly over the market. The federal government has been piling on the pressure recently, and has already filed three other suits against the industry leader. New York Attorney General Letitia James is co-leading the lawsuit, claiming that:

Google has left millions of Android users and app developers with no option but to use the Google Play Store. This is raising prices for consumers and squeezing millions of small businesses that are trying to compete.

Even the former President, Donald Trump, is hopping on the lawsuit bandwagon. The formal leader's social media presence was as explosive as his presidency, and earlier this year a bunch of big tech companies decided to ban him from their platforms for inciting violence. Now, Trump has said he is filing a class-action lawsuit against Google, Facebook, and Twitter as well as their executives, Mark Zuckerberg, Jack Dorsey, and Sundar Pichai, alleging unlawful censorship of free speech. That’ll make for an interesting courtroom.

GOOGL was down 1.55% in Thursday morning trading.
May 142021
🚀

Google reaches for the stars

Alphabet shares jump over 2% as Google wins a cloud deal from Elon Musk’s SpaceX to help deliver internet through its Starlink satellites. Talk about a dream team.

Google announced last week that its cloud unit is now in business with the revolutionary SpaceX after winning a deal to provide computing and networking resources to the company, delivering internet service through SpaceX’s Starlink Satellites. The new deal could last up to seven years, and shows SpaceX tapping into Google’s cloud infrastructure for its latest broadband service. The Starlink satellite internet will use Google’s private fiber-optic network to make connections better and faster. The space development company will install ground stations at various Google data centers that connect to its 1,500 Starlink satellites around the globe (literally), and hopes to be able to provide enterprises with internet that moves at the speed of light by the end of the year.

The fact that Elon Musk’s privately-held baby chose Google is a big win for the tech giant as it tries to capture control the quickly-growing and super competitive cloud computing market in the face of rivals like Amazon and Microsoft, who are already snatching away some of Google’s advertising territory. The company’s market share of search fell from 61% to 57% over the past year, while Amazon increased its share from 13% to 19% in the same period.

In making sure that Google keeps its spot as the default search engine on iPhones and other divides, its “toll fees” (the cost of all that traffic) have risen 30% to $9.71 billion in the last year. The COVID-induced surge in digital spending in the last year has been of great benefit to Google’s sales growth however, and investors are looking at its cloud business segment to boost growth in the event that its advertising segment takes a serious hit. While its cloud business is only about 7% of parent company Alphabet’s total revenue, it’s also grown by 46% up from the same period the year before, so things are looking promising.

This is one of a kind. I don’t believe something like this has been done before,

said Google’s head of global networking, Bikash Koley.

The real potential of this technology became very obvious. The power of combining cloud with universal secure connectivity, it’s a very powerful combination
.
Apr 052021

Google victory

Hey, wanna hear some big news? The U.S. Supreme Court finally ends a decade-long battle between Google and Oracle, handing Google a landmark victory and sending its share price up over 4%. Fun times.

The pair have been at each other's throats for years over supposedly copied code in Google's Android operating system. Tech titan Oracle first sued Google in 2010 for copyright infringement, claiming $9 billion in damages. Oracle said that Google had “replicated the structure, sequence, and organization” of over 11,000 lines of Oracle's original code and Application Programming Interface (API); parts of which were used to build Android’s operating system. We won't get into the gritty details (over 10 years, you can imagine there are quite a few), but the debate has turned into one of the biggest software development cases in a while.

It’s pretty rare that big tech would end up in the Supreme Court, and the court actually ignored a recommendation by the Solicitor General that it should reject the case, possibly because it would have such real implications for the growing tech industry and big tech companies going forward. It’s commonplace in Silicon Valley to freely use parts of other company’s software code to develop apps and products, and if the court had ruled in favor of Oracle, effectively allowing them to place copyright on APIs; that would mean an increase in the power of the dominant tech companies that control the most widely used technologies, which could impact competition.

Luckily, the court found that Google’s use of the code was “fair use” because it only used parts of the language to create a “new and transformative program”, which would foster innovation and competition. Justice Stephen Breyer, in his written opinion, said that "to allow enforcement of Oracle's copyright here would risk harm to the public".

Strong win for Google there.