Actually not so much, there is a fun class they used to give new employees at Google (called Nooglers) called &quot;life of a dollar&quot; (well that was what it was called when I joined) which talked about how Google made money with search advertising. And one of the key things about that class was how the cost per click, or the amount of money Google got when someone clicked a link, was fundamentally tied to how all of the other processes made (or didn&#x27;t make) money. After I left Google four years later, I actually joined another search startup called Blekko where not only did I get to see the &quot;high level&quot; view of where Google made its money (and how much it would share with us if we used their ads) I also got to see the contracts involved and the clauses where Google wanted to protect its margins. We also partnered with one of Google&#x27;s largest advertising redistributors, Infospace.<p>When I left in 2010 I started also following Google&#x27;s financial reports. Year after year, following that indicator you could see pressure on Google&#x27;s search ad business, and you could watch Microsoft&#x27;s Bing ads get to be more and more profitable. Did you know that if in 2010 Microsoft could get the same CPC as Google did for their ads on Bing that Bing would have out performed all other parts of Microsoft in terms of revenue and profit? As a search vendor in the middle I could see what Microsoft shared with us and what Google shared with us, and we could back compute the actual CPC, and the ratio of the CPC. Whats more we could watch Microsoft&#x27;s going up while Google&#x27;s was (and is) continuing to go down.<p>I was also there as their CPC plummeted and they told Infospace (and through them us) that we could no longer show Google ads on Mobile search. No only Google could from now on. And that wasn&#x27;t just us, that was everyone. And we&#x27;ve watched as more and more of their search page became &quot;sponsored&quot; in one form or another, and how people with Google ads on their web sites were getting less and less money, even though their traffic was the same or better.<p>I&#x27;ve been watching the Google money machine slowly deflate for the last 5 years (coming up on 6) and called almost every move they&#x27;ve made prior to them making it. All based on understanding that rounded to the nearest billion dollars, nothing in Google makes any money except search advertising. Even Youtube can barely break even these days and we&#x27;ve seen how the 99% of Youtube &quot;stars&quot; actually have real day jobs rather than be able to produce content for that service. We&#x27;ve seen Google working hard to &quot;yank back&quot; the whole Android is open source thing, in the name of &quot;user experience&quot; to be sure, but attacking Cyanogen? Threatening Samsung? Forcing HTC to throw itself under the Microsoft bus? And paying for more and more traffic, $4 billion a year? how much further can they push that life vest?<p>The good news here is that predictions are like freebies, you win some you lose some. No alien contact this year, sorry Inquirer! But I&#x27;ve been more right than wrong about predicting Google&#x27;s road and I&#x27;m confident in this one too. Google is stuck between a need to please the street and the cost of engineers that produce no revenue. They have way more of the latter than they need, and from what I can tell they have pretty much been aggressive as they can at getting rid of people &quot;gradually&quot; who were in the bottom 10%. And their CPCs continue to fall double digit percentages year over year, and they don&#x27;t have any business that is growing at that rate. Throw in an EU anti-monopoly monkey wrench, or a Facebook throwing their search over to Bing, or the EU getting their tax policy together and eliminating the double irish? Suddenly the need to shed costs fast will overwhelm their ability to do so quietly.<p>I kind of thought they would end up doing that this year but they dodged a bit by turning into Alphabet which gave them some new accounting tricks.<p>I&#x27;m sticking by my prediction they are going to have a layoff next year of between 8 and 12% of the company. They could surprise me by putting a bunch of people into an Alphabet subsidiary and then &quot;divesting&quot; themselves of that subsidiary. It would have to take 8 - 12% of the company though to make it worth while.<p>I understand your angst. Nobody likes to think about the company where they work having layoffs (hey I&#x27;m working at IBM which Cringely is constantly predicting will explode at any moment!) But the truth is that its really all sort of mechanical. Goods and services go out and money comes in. The costs of delivering those goods and services has a variety of components, the largest of which is often personnel.<p>And if you look around and realize the company could be making all the money it is currently making with or without you, and without you it would be banking the cost of your salary and benefits. Well then you need to be especially mindful of the indicators for the current business, and the growth rate of the revenue your project is contributing too the business versus the cost of keeping you around. It won&#x27;t be personal, it will just be the way it is.