Why is Google selling off its satellite fleet?
Google鈥檚 parent company, Alphabet, may have sky-high ambitions, but for now, it looks like they鈥檒l be .
With the sale of recently acquired satellite imaging company Terra Bella, Alphabet trades direct control over its own fleet of satellites 鈥� and all the hassles that can bring 鈥� for rights to purchase pictures for Google Earth from a third party. This reorganization is the latest in a series of moves focusing on balancing the company鈥檚 eclectic interests with investors鈥� desire for profits.
In 2014, Google, as the company was still called at the time, purchased Terra Bella and its constellation of seven high-resolution satellites for . Now, competitor for an undisclosed sum, it announced on Friday in a press release.
The Terra Bella satellites can provide Google Earth with crisp images resolving features smaller than three feet across, which Planet Labs says is more than 3.5 times the sharpness of their current fleet composed of 60 mid-resolution satellites.
As part of the deal, Planet Labs agreed to sell Alphabet imagery for the next five years, and Alphabet will receive a stake in the company. Planet Labs will also take on a number of Terra Bella employees.
Google underwent a dramatic corporate restructuring in 2015, when it created Alphabet as a parent company overseeing Google鈥檚 huge range of .
In addition to the standard search and advertising business, Alphabet also has its fingers in a variety of fields including self-driving cars, life-extension research, urban planning, and a number of other ambitious projects sometimes referred to internally as 鈥渙ther bets.鈥�
But search and advertising are really the company鈥檚 bread and butter. In 2016, ads made up almost 90 percent of Alphabet's revenue, prompting one ex-executive to say, 鈥淣o one wants to face the reality that this is an ,鈥� Bloomberg reported last year.
Some of those hobbies don鈥檛 come cheap. All together, the non-Google branches of Alphabet lost about $3.6 billion in 2015, double that of the previous year, Bloomberg says.
To reign in costs and mastermind the reorganization, Google/Alphabet brought in Ruth Porat, whose resume includes a stint as an adviser to the Treasury Department during the 2008 financial crisis. Her fiscal streamlining prowess has been popular with shareholders, but controversial among Alphabet鈥檚 many 鈥渕oonshot鈥� departments, where she鈥檚 known by the nickname Ruthless Ruth
鈥淪he鈥檚 a hatchet man,鈥� a former senior Alphabet executive told Bloomberg. 鈥淚f Larry isn鈥檛 excited about something,鈥� the executive continued, referring to CEO Page, 鈥淩uth kills it.鈥�
Other recent casualties include the canceling of an internet providing, , and an attempt to sell off聽.
But other moonshots have made the cut. Development continues on project Loon, for example, which aims to provide free or low-cost internet to as many as 4 billion people via a worldwide fleet of 100,000 giant weather balloons, as pictured above. Think Pixar鈥檚 animated movie Up, but one colossal balloon carrying a super powered wifi router instead of a house.
Meanwhile, Planet Labs has big dreams too. On valentine's day, it plans to launch a record-breaking 88 satellites to expand its current range to .
