Google, Microsoft, Stall Points, and Growth
April 7, 2015
When might Google have its Microsoft moment? That is, when will it begin its inexorable decline – as most aging tech companies do when their growth stalls, and as Microsoft did – largely unbeknownst to (and even denied by) most observers? How might we know?
I have a few things I look for when thinking about inflection points in aging technology companies. Not all of these conditions need to be satisfied, but at least some of them do.
There are five major parts of the argument:
1. Stock compensation loses its luster
2. Declining growth
3. No longer hiring for innovation
4. Price & margin pressure in core business
5. Government action
1) Stock compensation loses its luster
Generally speaking, technology companies retain their best employees with equity compensation more so than with salary. And when that equity
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