Google is often regarded as the tech company willing to try anything in the name of science and technology. It is that ‘try-anything’ attitude that has brought about Gmail, Google Glass, and self-driving cars.
That’s why many were surprised at the jabs by PayPal founder and prolific Silicon Valley investor Peter Theil towards Google’s Eric Schmidt on a recent panel for Fortune Magazine.
Google is a great company. It has 30,000 people, or 20,000, whatever the number is. They have pretty safe jobs. On the other hand, Google also has 30, 40, 50 billion in cash. It has no idea how to invest that money in technology effectively. So, it prefers getting zero percent interest from Mr. Bernanke, effectively the cash sort of gets burned away over time through inflation, because there are no ideas that Google has how to spend money.
Google is no longer a technology company, it’s basically a search engine. The search technology was developed a decade ago. It’s a bet that there will be no one else who will come up with a better search technology.
Thiel argues that any companies that are hoarding cash instead of investing it in further technology innovation are not only holding back technology for the general public, but the economy as a whole. He thinks that tech juggernauts such as Google, Microsoft and Apple with billions in the bank should be pouring that into further innovation.
What do you think about Google’s recent investments into technology? Should they be doing more? Are tech companies that hold on to cash stifling innovation and the economy?