Alphabet's experiment department seeks backers

X has long been the name for the department of the Google Group Alphabet that pursues particularly risky technical ideas. So-called moonshots: They have little chance of success, but if the worst comes to the worst, so much profit beckons that you could stack the money up to the moon. So much for the idea.

Internet supply via balloons or long-term flight drones, self-driving cars, contact lenses that measure blood sugar levels, Google Glass, or a new fiber optic provider for US households and other things were all being brainstormed at X. Behind this was the courage to be wasteful. In Alphabet's financial reports, X falls under the “Other Bets” division. This item traditionally has minimal turnover and makes significant operating losses.

Restructuring

But in 2017, the Google Group started to cut costs; now it is doing so again. This time, the management is taking a more radical approach. On the one hand, dozens of employees are being made redundant, as BNN Bloomberg reports, citing insiders. On the other hand, Alphabet's X division, headed by Astro Teller, is being restructured.

Alphabet no longer wants to be the only one wearing the spending pants. The new structure should make it easier to spin off projects as independent companies. Behind this is the new-found hope of attracting outsiders as venture capitalists [–], not just traditional venture capitalists, but also more conservative investors and companies that are already established in the respective industry. If you can't beat them, join them.

According to the report, the new mission statement includes a fundamental cost-cutting course and a departure from the previously practiced secrecy. In the future, X projects should be more open to collaboration with other research and development institutions.

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