Google shifts culture, CEO notes 'this is a business'

Alphabet CEO Sundar Pichai announcing this big company reorganization in a new memo consolidating teams to help develop AI products more quickly. But he also hinted at a new type of workplace culture for Google. Deboza has the details in today’s Tech Check. Hey, Dean. Hey Carl, good morning. So let me give you a bit of context. Google has really been the poster child of cuddly tech culture. Kombucha on top, masseuse is on staff. That’s the softer side of it. But also for many years it was tolerated an openness for employees to bring social political causes to work. Mix ethics and business. Its founding mantra even in a biggest example of this don’t be evil. But we are increasingly seeing a tougher Google and a tougher Sundar Pichai at the top, necessitated perhaps by this increasingly competitive race in AI Pichai. Pichai just sent a note to employees outlining. How he is going to streamline the business to simplify structure, improve velocity and execution. But the most interesting part of his memo that came at the end of it, he wrote, and I’m quoting him here. This is a business, not a place to act in a way that disrupts coworkers or makes them feel unsafe to attempt to use the company as a personal platform or fight over disruptive issues or debate politics. And guys, this was a not so veiled nod to what happened earlier this week. A group of Google employees, they staged a sit in across a number of Google offices, including one. Inside of Cloud CEO Thomas Korean’s office at headquarters, they were protesting a more than $1 billion Israeli government cloud contract. But instead of hearing them out or dropping the contract like Google did back in 2018 with the Pentagon AI contract in response to employee blowback, Google instead nearly immediately fired nearly 30 of the employees involved in that sit in and Pichai’s memo now underscoring this point that this is a business, IE, don’t bring your social causes to work. That is certainly a departure of the Google we’ve known for the last few decades. To further put this in context, look at Meta’s announcements yesterday. It is integrating its AI assistant into its family of apps. It also announced the arrival of Llama three, the next version of its open source large language model. So the goal posts here, they are shifting very quickly and Google seems to understand that it needs to get its house in order so that it can keep up or take back the lead, which some feel that it’s given up. Now how it impacts the financials, the stock, the race will be certainly playing out at the top and bottom lines of the mega caps as we have been tracking and in particular. I will be looking for more of this kind of commentary or hints of a tougher Google, a Google on the offense, which I’ve been talking a lot about when it reports next week. It’s Tuesday. Also courts house searched its cash cow is being impacted by the competition. You can see on your screen, guys, we’ve got the magnificent 7 coming up. It is going to be a very, very busy few weeks filled with lots of mentions on their AI strategies and monetization that could once again flip this race.