One Week Later

Mountain View, June 3, 2011 - Posting about an event a week after it occurs is like writing about the Peloponnesian War---it's ancient history. Nevertheless...

I've owned the stock for several years, but I had never attended a Google shareholders' meeting. Although I drive by the Mountain View Rengstorff exit on Hwy 101 several times a week, I had never even been to Google's offices (in the tech world they're now "campuses", which is appropriate given the age and attire of the employees).

Curiosity about the facility was one lure. Another was the free food, which despite recent cutbacks, was locally renowned for its quality and variety. And I did want to hear new CEO Larry Page handle questions from the floor. (See for yourself - he steps up to the stage 31 minutes into the meeting, speaks for 15 minutes, then fields questions.)



Larry Page and the other executives on stage seemed sensitive to the widespread perception that Google spends a lot of resources on fanciful projects (e.g., driverless cars, alternative energy) that are far removed from its core businesses. Their response was: 1) only a few people work on these projects; 2) they apply a high "cost of capital" hurdle to such risky endeavors; and 3) the original proposals for Chrome and Android were viewed with much the same skepticism, and look how they turned out.

When the meeting was over, I didn't have a different opinion about Google than when the meeting started: Google has some of the smartest people in the world working for it; they do have a track record of successfully monetizing some of their products but not others; I have a slight disquiet, only a feeling, really, that makes me hesitate in believing 100% that they know what they're doing. The fear is not that they'll make mistakes, it's that Google has created a high cost structure that will be damaging if revenue streams fail to materialize. Remember that Google went public in 2004, and most of its employees and managers haven't had the experience of operating during tough times.

Well, I did enjoy the food. The salad and entrees were of a higher quality than any company cafeteria that I've been to. In looking after its shareholders'appetites, Google is eating Apple's lunch.

In the demo area an "android" was controlled by an Android phone.