Google's austerity campaign
The best place to work in America is becoming like every other big corporation. Google, at its heart an overgrown advertising agency, is most famous for its lavish perks. Now those are disappearing.
The billions gushing in from Google's search monopoly don't make for a good story. Whenever Google's PR executives have looked to drum up press, they've led with the candy-colored offices, the free food, and the copious free time. All of those are now on the chopping block — which leaves not much to talk about at Google except the profits.
The Wall Street Journal takes a look at Google's new push for cost cuts. As others have reported, Google is curtailing service at its cafeterias, reducing hours and restricting guests. A third of Google's 30,000 workers are contractors — and many of those jobs will disappear. (Conveniently, when a contract ends, it's not deemed a layoff.) And superfluous offices are being shut.
More importantly, Google's employees no longer have free rein to pursue their own ideas. Google's engineers can spend 20 percent of time on side projects. That freedom remains, in theory, but the progress a lone engineer can make on a new website without hardware and additional personnel is limited. The new message: Fiddle all you want, but don't expect any money from Google to back your creation.
When Google went public in 2004, founders Larry Page and Sergey Brin told shareholders to get ready to be taken for a ride. Not in so many words, of course. But in the company's IPO prospectus, they defended the company's already-lavish perks, and said that investors should expect spending to go up, not down.
But Larry and Sergey have grown tired of coddling their employees. Far from being grateful, the perks have made employees feel entitled. Brin in particular has complained about workers taking bowls of M&Ms and free bottled water for granted.
Why should Google's founders care, really? They seem increasingly detached from Google's core business, preferring to spend time on rockets and electric sports cars rather than optimizing AdWords. They increasingly deal with a small core of early Google employees, all IPO lottery winners, who are similarly insulated from the economic reality of living in one of the most expensive areas in the U.S.
A famous example of their cluelessness: Brin allowed his sister-in-law, Susan Wojcicki, also a Google executive, to spend millions of Google's money on a new child-care center which dramatically raised its costs. Rather than revise plans to make child-care more affordable, Google started charging employees nearly twice the market rate.
Investors will be unbothered by Larry and Sergey's change of heart. And employees, after they get done grumbling, will likely content themselves with the reality that they still have jobs.
No, the people hit hardest by this will be Google's flacks — and the servile journalists who so eagerly celebrated Google's lava-lamp culture. What stories will they tell now? How Google is cutting corners on the organic foie-gras hamburgers in its cafes?