A snapshot of Google

Yesterday’s Wall Street Journal reports on Google’s meeting with financial analysts on Wednesday, the first such meeting since the company’s initial public offering last August. Earlier this month, Google reported fourth-quarter earnings that roughly doubled from a year earlier.

The Journal’s report (and related reporting, noted below) is helpful in getting to know some aspects about Google that are useful in extending your knowledge about a company that is pervasive with so many fingers in the technology we use in our business and personal lives.

For instance, the report says that Google are aggressively adding products and staff but are limited by their own recruitment standards and ability to expand their technical infrastructure. The company is known for a rigorous hiring process, which can include tests of the candidate and more than a half-dozen interviews.

The company said they can’t expand as rapidly as they would like because they can’t find enough qualified employees or deploy new computers fast enough. The Journal quotes co-founder Sergey Brin as saying, "We’re underinvesting in our business because of the limitations of hiring." Google said it has more than 3,000 employees, up from 2,292 in June 2004.

The presentations made by Google executives to analysts offered little new information about the company’s strategy or financial prospects, the Journal said. But, for the first time, CEO Eric Schmidt outlined how executives allocate resources:

  • Roughly 70% of Google’s effort goes into its core search and advertising services.
  • About 20% is devoted to other search-related products, such as Google News.
  • The final 10% is devoted to projects unrelated to searching, such as its social-networking service and Picasa photo-management software.

Schmidt said Google was seeking to reach advertisers outside the midsize companies it currently serves best, the Journal reported. "We still, as a company, do not have all of the products and services needed to serve all of the largest advertisers or the tiniest of advertisers," he said. In the fourth quarter, Google had 227 advertisers that were on the Fortune 1000 list of the largest companies, compared with 156 a year earlier.

Highlighting one potential change, co-founder Larry Page said Google over time will give advertisers "more choice over where and how they show their ads."

Wall Street Journal | Google Expansion Is Being Held Back By Hiring Process (paid subscription required)


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