Google CEO Sundar Pichai has closed various projects within the company over the past six months in an effort to cut costs. This Friday, he finally let the ax fall on most of Google’s employees. In its biggest layoff to date, Google says it will cut 12,000 of his jobs at Google and its parent company Alphabet. This reduction represents about 6% of Google’s workforce and is consistent with recent similar moves by Microsoft and Amazon.
Pichai announced the layoffs on Google’s blog, saying that U.S. employees who will be laid off have already been notified. As for foreign employees, Pichai said, “This process will take longer due to local laws and practices.” Pichai blamed the economy for the layoffs, saying he was “hired because of an economic reality that is different from the one we are currently facing.”
As usual, Pichai talks about AI as the future of the company, stating, “Our transformation of the company to be AI-first a few years ago resulted in a breakthrough for our business and the industry as a whole.” said. However, Google struggles to monetize much of its AI work. Google’s best-known AI product is the Google Assistant, but its support reportedly declined after its monetization plans fell through (Amazon Alexa faces a similar fate). Deepmind amazed the world with his ability to play against top his players in the complex game of Go, but the project never developed into any kind of business.
A hot new feature in AI is a collection of bots that take on creative tasks, including ChatGPT chatbots and artwork generators. The rise of these projects has hurt Google’s reputation as a leader in AI, and Pichai has declared “Code Red” against the company. Google is supposedly working on a chatbot product, but it’s unclear why a creative writing bot would be any different in a world where useful tools like Alexa and Google Assistant aren’t profitable.
Pichai’s cost-cutting mandate began in July when he said the company’s productivity was “not at the level we need it to be.” After that, Google dropped its hardware division’s efforts on laptops, spun off Project Loon, split Area 120’s “idea incubator” group in half, scrapped Google Stadia, and reduced its investment in Google Assistant. decided to integrate Waze into Google Maps and cut Alphabet’s health by 15%. He cut Verily’s workforce and cut the workforce at the “Intrinsic” Alphabet robotics company by 17% of his.
Pichai says there will be a town hall on Monday.
