Friday, November 12, 2010

The new Borg

In the march towards Total World Domination, with the recovery of its stock and explosion of Android, Google seems to be in the driver’s seat. But what captures this march? If Microsoft is the Beast of Redmond or the Borg, then what is Google? For two years I’ve called it the Monster of Mountain View, but it is only rarely used.

Perhaps the “Borg” metaphor is more appropriate nowadays: not because it’s relentlessly crushing enemies, but the way that it’s inhaling raw talent. Particularly over the last two years, Google has the pick of Silicon Valley when it comes to recruiting as most IT companies are fighting the relentless march of commoditization. It’s #4 on the latest Fortune list of best places to work — the only Silicon Valley firm in the top 10 and one of three in California (the others being DreamWorks and Qualcomm.)

Meanwhile, the once-great HP is locked in a commodity business and has been cutting pay for several years and laying off workers for a decade. Meanwhile, Google is raising salaries 10%, and with it operating expenses by nearly 4% ($400 million). Because the generosity depressed GOOG stock, Google reportedly fired the employee who leaked the memo.

What I find anomalous is how the company is not just hiring from industry, but also inhaling bright minds from academia. I’ve know engineering and C.S. types to take a rotation in industry, but it’s much less common in business or economics.

Three years ago, Google convinced once of the world’s most senior information economists, Hal Varian, to leave Berkeley where he was a chaired professor and former dean of the Information School. Varian converted his temporary leave (one of the perks of academia) into retirement, according to his Berkeley website.

Less visibly, at the same time Google also landed Josh Mindel, an assistant professor at San Francisco State’s business school. This year they took Dave Mease from the SJSU b-school — right now David is on leave, but the flow of talent into Google seems to be similar to the flow of matter into a black hole.

As someone who used to work in industry, I can see both sides. Academia (post tenure) has unmatched job security, good medical and retirement and an unmatched degree of personal autonomy. Going to Google would probably mean a 50 or 100% pay increase, stock options and resources to pursue any interesting problem. Google’s 20% time plan also provide an intellectual freedom unheard of in industry.

The one question mark is: how long will it last? For the best jobs at AT&T — Bell Labs — the golden age extended across more than five decades. For IBM, the comparable period was about 30 years, while for Apple it was only a decade. Microsoft Research still seems to be offering attractive working conditions, but for ordinary employees the bloom went off when the stock options stopped being valuable.

So how long will Google’s run last? Absent draconian regulation — antitrust lawsuits ala AT&T and IBM — it could be a great place to work for another decade. However, the end at IBM, Apple and Microsoft came with unexpected swiftness, so I wouldn’t bet the house on it.

Update Nov 19: Google has now hired tenured Harvard CS prof Matt Welsh; his colleague Michael Mitzenmacher rationalizes why he’s not jumping ship (yet). H/T: Youngjin Yoo.

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