Anytime the CEO of a massive company in our industry speaks, we hang on every word — we had the opportunity to do just that with CEO of Alphabet and Google, Sundar Pichai, thanks to a fresh interview with The Verge. It's a well-timed interview, from our perspective, given the recent news of a shakeup in the top ranks of the Pixel team — and thankfully Pichai spoke specifically about Google's hardware business:
The last couple of years have been a major integration phase for us because we've combined our Google hardware efforts with Nest. We absorbed the mobile division of HTC. So it's been a lot of stitching together. And we have a wide product portfolio, too. So it's definitely been a building phase. We're super committed to it for the long run. Hardware is hard. And it definitely has components, which take real time to get it right, thinking about underlying silicon or display or camera or any of those tacks.
I'm not particularly impressed by the answer, if I'm looking at it from the view of someone who's interested in the advancement of its Pixel phones. It's very clear that Pichai sees the entire Google hardware business as important, but we didn't get anything to indicate that phones are a particularly important part. We have to remember that phones are just a fraction of its hardware business — there's Google Homes, Nest products, Google Wifi, Pixelbooks, Chromecasts, Stadia and more. Hardware as a whole is just part of Google's strategy for computing to begin with, and phones are just a small portion of that:
We think about our hardware efforts obviously in the context of our overall computing efforts and in addition to what our ecosystem is doing. So we take that into account. I do think it's important we build a sustainable business, financially, too. Because I look at the level of investment hardware needs, both in terms of all the technology R&D you need to do, the kind of supply chain you need to develop, as well as the go-to-market investments you need. So it's a deep investment. So to do it well, I think you have to do it with a clear financial sustainability goal.
Outside of mentioning that the Pixel 3a was an incredibly well-rated product and boosted Pixel sales overall (something Pichai's noted in earnings calls), he didn't really give us much to be confident about the direction of Pixels in particular. I understand that Google has a longterm view for developing many parts of the Pixel experience, as Pichai notes "it definitely has components, which take real time to get it right, thinking about underlying silicon or display or camera." And I get that "hardware is hard" — but this is Google we're talking about, with unbelievable resources and by all accounts a large team of incredibly talented people.
Google has a long outlook on hardware, but we seem to never get closer to the end product.
To Dieter Bohn's (one of the interviewers) credit, he attempted to push on the question further by pointing out that Google seems to constantly have a five-year view ahead for its burgeoning hardware business, which each year seems to just push another year into the future. We've heard this "it's hard, and we do want to make sure this is a financially viable and successful business" time and time again, with an expectation of multiple years to mature ... at some point it has to actually mature.
Google's CEO had a chance to make us more confident in the Pixel series, but we got a typically mundane non-answer once again. Pixel fans want to hear more than "we're super committed" — we want to know how you're committed. Are you committed to just making a Pixel phone every year? Or are you committed to actually making the Pixels better and better every year and pushing the smartphone industry? Are you committed to growing the Pixel's market share? It really isn't clear. All we know is that the Pixel line isn't dead. So that's good.
Google may be committed to Pixels internally, but it doesn't really show in the public eye.
Of course, it's tough to know just how much to look into statements from a CEO. Pichai is incredibly well spoken, and he knows exactly how to say the right things and not step outside of his lane into anything even approaching controversy. As the CEO of Alphabet as well as Google, Pichai isn't involved in the day-to-day operation of any of the individual business operations — particularly one with as little impact on the bottom line as the hardware business. From that perspective, Pixel fans should be happy he spent this much time talking about phones at all.
But as a Pixel fan myself, I would love to see a bit more conviction and reassurance that Pixel phones still mean something inside Google. Because the perception of the products and the company's emphasis on them from the outside is fading. I want to see, from a public perspective, that Google's committed to making great Pixels.
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