Alphabet says Loon and Wing are ready to become real businesses, but it’s impossible to know if any of its ‘other bets’ are paying off (GOOG)
Alphabet announced that Wing and Loon, two projects developed by its X research lab, have now graduated to being full businesses in its “other bets” category.
The move means the company thinks their technical problems are solved and it’s time for them to develop as businesses.
That’s potentially good news for investors, but it’s hard to know just what to make of it.
Collectively, Alphabet’s other bets have been losing billions of dollars each year and dragging down the company’s earnings.
But because the company offers no details on the individual results of its other bets companies, it’s impossible for outsiders to assess which have potential and which are dogs.
Loon and Wing can no longer be considered loony or wing nut ideas.
Now, whether either of them will ever make any money for parent company Alphabet, or were worth what it invested in them is still anyone’s guess.
Google’s parent company announced Wednesday that Loon, which is developing a balloon-based internet delivery system, and Wing, which is working on an aerial-drone delivery service, have graduated from X, its research lab. The two projects will now be sister companies to Google, operating as part of Alphabet’s “other bets” segment.
That’s a significant development. Loon and Wing are just the sixth and seventh X projects to be spun out of the lab as full companies since Google launched X in 2010 — and just the fourth and fifth to join Alphabet’s other bets.
According to Alphabet, the move is an indication it believes it’s solved the technical problems facing both projects. In their parent company’s view, both have now reached a stage of their development where their primary challenge is figuring out how to take their products to market.
“Loon and Wing are ready to take their products into the world,” Astro Teller, X’s CEO, said in a …read more
Source:: Business Insider