Google to Build Giant British HQ

september-10-01Online technology firm Google has won approval to build a new headquarters in the UK. The company plans to complete its new London headquarters by 2016, giving it an additional 920,000 square feet of office space in the capital.

Google’s new UK headquarters includes a lengthy list of extra features and facilities, many of which are based on its California ‘Google Campus.’ The building will have its own climbing wall, which runs between the floors of the building.

Other features include a 20,000-square foot area for bicycle baking, a running track on the roof of the building, and a swimming pool for employees. The building will be located next to King’s Cross train station.

Unlike many other technology firms, Google has chosen not to build high-rise office buildings. The new Google headquarters will be a low-rise development, with seven to 11 stories for offices and other facilities.

Despite its modest height, the building is expected to be one of the largest in King’s Cross. Current plans put the building’s length at 330 metres, giving it a length that’s greater than any city high-rise development, including the 310-metre Shard.

Google’s move into King’s Cross is expected to attract other technology firms to the area, creating a new technology hub for London. The building will be located in the new King’s Cross Central development, which will span over 67 acres.

The development will contain residential buildings, retail shopping malls, and other offices. Google’s involvement is seen as a huge benefit for the area, which has never been one of London’s major commercial office districts.

Google is fairly new to the property development business, preferring to lease its international offices and avoid major investments in real estate. The new London office will be its third overseas development, after its Paris and Dublin offices.

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ComScore: Yahoo Generated More Traffic Than Google in July

august-22-02After almost a decade of decline, former online giant Yahoo has regained the pole position in online traffic. Yahoo’s network of web properties attracted more traffic than Google during the month of July – a first for the company since May of 2011.

The company’s network of websites attracted 196 million users in July – an increase of 21 percent during the last twelve months. ComScore, which measures web traffic, claims that the company’s websites attracted 4.3 million more visitors than Google.

Yahoo has been involved in a long-term turnaround effort aimed at returning the once dominant company to the online top spot. CEO Marissa Mayer has motivated the company to improve its services in order to attract a greater number of users.

Yahoo has revised its homepage and weather services over the past year to attract more traffic from households. The company has also redesigned its email services, which are used by over 281 million people around the world.

Despite the growth in traffic, Yahoo’s revenue has thus far failed to impress many in the technology industry. The company earned $1.07 billion in the first quarter – not far below analysts’ estimates of $1.08 billion, but far from confidence inspiring.

The user data does not include information for Tumblr, a new web property bought by Yahoo earlier this year. The company spent $1.1 billion to acquire the network of blogs, which has growth to reach more than 300 million worldwide users.

Google, which is significantly more popular than Yahoo for search users, attracted a total of 192 million users in July. Many of these were users browsing Google’s video websites YouTube, which displays the company’s display advertising product.

While Yahoo’s revenue growth is currently failing to keep up with its increase in users, the new traffic is certainly a good sign. As Mayer noted in a conference call with Yahoo employees, it’s very rare for an established company to see a surge in traffic after years of gradual decline.

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Google’s Industry-Leading Staff Turnover Problem

august-01-02Despite its rapid growth and current dominance of search, Google has a problem: it can’t seem to retain its employees. The Bay Area technology company boasts one of the industry’s finest campuses and some of its best salaries, but its employees seem to leave the trendsetting technology company as soon as they arrive.

Read a Google employee handbook and you’ll be impressed by the perks. Staff are free to enjoy five-star food at work, benefit from some of the best health insurance available, and attend free yoga classes after work. Mothers are given five months of maternity leave, and 84 percent of employees report being satisfied with their jobs.

Despite this, the average Google employee spends just one year at the company. The search giant, which has boasted a 90 percent market share for several years, has one of the highest turnover rates in Silicon Valley, with young employees leaving for new opportunities as quickly as they walk through the door.

Part of Google’s problem is undoubtedly the age of its workforce – unlike other Bay Area firms, which look for long-term employees interested in growing alongside the company – Google tends to hire young professionals. The median age for Google is just 29 years – a point at which many professionals tend to ‘career hop.’

Other tech firms have similar figures regarding turnover, although few are as bad as Google. Yahoo pays its employees over $107,000 per year on average, yet retains its talent for just 2.4 years. In other industries, figures are better – ExxonMobil holds on for 6.5 years on average, due to its significantly older workforce.

Despite its incredible staff turnover rate, Google continues to dominate search. The company, however, may want to take a look at its lucrative benefits and think about whether they’re really having that much of an effect on employee retention.

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Big Companies Face Innovation Decline, Investors Claim

july-25-01As they grow larger, businesses tend to innovate less and focus on proven products and service more. That’s the belief of Aberdeen Asset Management executive Martin Gilbert, who claims that large businesses often lose the entrepreneurial spirit which contributed to their initial success as they grow into larger operations.

It’s certainly a theory that holds some weight, particularly with many of the leaders of technology switching from a model built on innovation to one that’s built around gradual improvement and an increasingly refined product. The result, Mr. Gilbert is quick to say, is the result of having ‘more people in the decision making process.’

Leading technology company Google is a fantastic example of the theory in practice, with its recent products often built around improving search – something that has been at the core of Google’s business since 1997. Google has increasingly killed off its extra products in favour of improving and optimising its core search function.

Apple, another innovator, has been stuck in a similar rut. Investors and technology industry commentators have voiced their concerns about Apple’s lack of brand new products in recent years, claiming that its focus has shifted from creating new things to refining its existing products since the death of co-founder Steve Jobs.

Others in the technology world have dealt with similar problems. Others, however, such as Amazon.com, have innovated more as their businesses – and their market share – grew larger. The company’s Kindle and its recent investment in television content have made Amazon.com one of the last decade’s top online innovators.

While some companies get caught in a rut as they grow, offering little in the way of innovative products that made them popular in the first place, others seem to make the opposite change. Given the change in some of today’s top technology firms, is it unrealistic to think that we could see an entirely different market by 2023?

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july-20-01Technology companies Microsoft and Google have both missed earnings targets as poor sales of tablet hardware and online advertising reduced both companies’ net income. The two companies are some of the largest in the tech sector, dominating the home software and online search advertising markets respectively.

Google has increased its profits by more than 16 percent in the last year, which is certainly not disappointing news for most technology companies. Despite this, the earnings fell below expectations as analysts had expected the company to see far greater growth as mobile advertising – Google’s newest service – gained ground.

Advertising, which drives over 95 percent of Google’s total revenue, resulted in a large increase in revenue, with the company earning 15 percent more than in the last twelve months. Most of the growth has come from mobile advertising, but low rates reduced Google’s earnings to below-estimate levels.

Google CEO Larry Page has called mobile advertising a ‘challenge’ and claims that the company needs to embrace the new technology. Google and Facebook, two of the largest online advertising firms by user reach, are both increasingly focusing on mobile advertising products.

Microsoft, on the other hand, has experienced poor sales of its Surface tablet – a web tablet designed to compete with Apple’s iPad. The company has a mixed record with hardware investments, as the ill-fated Zune MP3 player also failed to catch on with a mass audience in the face of competition from Apple.

The Redmond-based company made $4.5 billion in the second quarter, with sales of its operating system driving most of its profit. Microsoft has also successfully made its way into the competitive gaming hardware business over the last decade with its Xbox 360 gaming console and the upcoming Xbox One hardware.

Despite profits falling below expectations, both firms remain optimistic about long-term growth. Google’s large array of advertisers is increasingly investing in mobile advertisements, while Microsoft’s enterprise solutions continue to drive most of its revenue.

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Tech Firms Struggle With Tax, Revenue Growth, and Innovation

july-18-01The last six months have been difficult for some of the world’s largest tech firms, as allegations of tax evasion and profitability issues rob market leaders of their status and public image. From Google to Yahoo!, the giants of the tech world have had an eventful, if not particularly easy, time during 2013.

In May, leading social network Facebook posted revenue of $1.46 billion in the first quarter of the year. Despite the impressive growth – Facebook’s revenue was $1.06 billion a year earlier – the company’s net income was $219 million during the same quarter, putting its earnings per share at a fairly weak 12 cents.

The social network’s growth has largely been attributed to an increase in mobile advertising earnings from users accessing its platform by phone. The ad industry, however, has reported mixed results from Facebook’s desktop advertising service, which produces the majority of the company’s revenues.

Likewise, former tech leader Yahoo has hit some roadblocks in its path to financial recovery. The company, which once sold more display advertising than any other online firm, struggled with reduced revenues and a core business that’s rapidly moving away from advertising revenue and towards developing new products.

Google and Amazon.com, a search advertising firm and online retailer, have faced serious allegations of tax evasion in the United Kingdom. Google, which is the UK’s top search engine, is caught up in a scandal regarding its use of Ireland offices to declare income generated in the UK, which some analysts believe is illegal.

Amazon.com is facing a similar situation regarding tax avoidance, which has hurt the well-known online retailer’s image. Facebook, which sells advertising to many UK and EU-based companies, also uses Ireland offices for the majority of earnings, leading many to believe that it could be the next firm under the ‘tax spotlight.’

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Yahoo Struggles to Grow Revenue Despite Major Changes

july-17-02Struggling dot-com company Yahoo! Inc. failed to impress analysts and investors as recent revenue forecasts fell below expectations. The dot-com company, which was once one of the largest online advertising firms in the world, reported sales of $1.06 billion in the current quarter, falling below analyst estimates of $1.12 billion.

Total sales during the second quarter of the year also fell below expectations, with a total of $1.07 earned on expectations of $1.08 billion. Yahoo’s key source of revenue, advertising, has struggled to sell as increased competition from firms such as Google and Facebook for display advertisers hurt the firm’s revenue base.

Yahoo has struggled to return to its former position of dominance in recent years, as firms such as Google and Facebook captured much of the online portal’s users. Once the Internet’s largest display advertising company, Yahoo’s per-quarter revenues of just $1.06 billion put it far behind online search advertising leader Google.

Despite its sluggish advertising performance, Yahoo has benefited from a series of high-profile acquisitions. The company acquired a stake in Chinese wholesale firm Alibaba in 2005 as part of a strategic partnership with Yahoo’s Chinese office. The exporting website has grown substantially along with Chinese manufacturing.

The company has been in the spotlight recently due to controversial policies put into place by new CEO Marissa Meyer. The CEO changed Yahoo’s policy on remote working, requiring thousands of mobile employees to change their roles and start commuting to Yahoo’s network of offices around the United States.

Other controversies involve Yahoo’s slipping advertising market share, which has sunk to just 7.9 percent from 9.2 percent in 2012. Rival display network Facebook posted a two percent increase in market share, while search firm Google benefited from a three percent gain, giving it 18 percent of the online display market.

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Google’s New Project Loon Could Transform the Internet Connectivity Industry

june-16-01Google’s latest innovation isn’t a social network or online collaboration tool, but a balloon-powered network of Internet connectivity nodes spread across the South Island of New Zealand. Called Project Loon, the new network uses special balloons situated above New Zealand to allow for antenna-based Internet connectivity.

The project will launch later this month in the Canterbury region of New Zealand’s sparsely populated South Island. Google’s network of high-altitude balloons will be launched from outside Christchurch, providing a connection to a team of volunteer ‘test pilots’ based in the Canterbury region.

The new network could go global if early tests are successful, bringing a powerful new option to the table for the billions of people that have regular access to home Internet connections, and an innovative solution to the estimated four billion that lack a stable connection.

If successful, the project could also grow into a major competitor for existing DSL and fibre Internet connectivity companies. Google’s network lets users connect to the balloon system from a high-powered antenna outside their building, making it possible to bypass the traditional telephone line network for connectivity.

The balloon network is situated approximately 20 kilometres above the surface of the earth, above commercial air routes. The balloons can be strategically lowered and raised in order to make use of wind, allowing the network to travel around the planet, increasing connectivity in sparsely populated regions.

Google’s innovative new balloon network is controlled by an algorithm that moves the balloons automatically to achieve maximum coverage. Project Loon is entirely self-powered, with each balloon equipped with solar panels that allow it to extract its daily energy requirements from the direct sun it’s exposed to while in space.

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Margaret Hodge Takes Aim at Google for UK Tax Avoidance

june-13-03Online search firm Google has been in the spotlight recently due to its UK corporate tax scheme. The technology firm, which derives its income from online advertising, is alleged to have diverted billions of dollars of UK-based income through its Ireland office in order to avoid paying UK corporation taxes.

Google executive Eric Schmidt has claimed that the corporation’s tax operations are completely legal and ethical, and that the firm’s Ireland office is responsible for all of its operations in the UK. The former Google CEO also recommended that the UK tax code be simplified in order to make it easier for foreign technology firms to comply.

Google is by far the UK’s largest search engine, boasting a market share in excess of 90 percent. Its Adwords product has earned over £11 billion in revenue during the past five years. MPs and investigators have claimed that Google’s total tax payments on the £11.5 billion in turnover amount to little more than £10 million.

While the company’s tax arrangements are widely considered to be legal, MPs have called for the online search giant to pay more in UK taxes. Margaret Hodge, Chair of the Public Accounts Committee, claims that Google has an obligation to contribute to society through its tax payments.

The Labour MP also claimed that Google’s strong sense of morality in other areas – a corporate culture encapsulated in the firm’s ‘do no evil’ slogan – should be causing it to lead the way in paying corporate taxes. Ms. Hodge has called for HMRC to ‘staff up and toughen up’ in the way it approaches tax avoidance by foreign corporations.

Google is one of several foreign companies that pay very little in corporation tax. A wide range of international corporations, including coffee chain Starbucks and US-based computing firm Apple Inc., are also alleged to engage in tax avoidance.

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PRISM: Apple and Facebook Deny Any Knowledge of Spying Program

june-10-01The media furore surrounding the recent leaks of the PRISM surveillance system has been extensive, with two primary targets in its crosshairs: the American NSA, as well as the Obama Administration. Both have defended their spying activity as being one of several important lines of defence in protecting the United States’ security.

The PRISM network depends on communications and technology firms for its data, with companies like AT&T and Verizon granting access to their databases. However, two major participants in the PRISM program – at least on a data access level – are voicing their confusion over their companies’ involvement in the program.

Mark Zuckerberg, the CEO and co-founder of Facebook, reported to the media that his pioneering technology company “had never been part of any program to give the US or any other government direct access to our servers.” The CEO added that his company would aggressively fight government efforts to obtain user data in bulk.

In a press statement, Apple claimed that they “do not provide any government agency with direct access to our servers and any government agency requesting customer data must get a court order.” The company, like Facebook, denied any knowledge of the PRISM program, claiming that it never released bulk user data.

Google was another technology company to defend its user policies and deny any knowledge of the PRISM program. In a blog post, Larry Page, Google’s co-founder claimed that Google had not joined any surveillance program, and that the PRISM program’s nature compromised “freedoms we all cherish.”

The existence of the PRISM program has pushed further doubts on the privacy of many Facebook, Apple, and Google users. As more information about the extent of the US government’s spying comes to light, users may learn more about their data and its security on leading online services.

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