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Google plans for staff cuts at its in-house incubator

By Nithya Bose in US business news, posted September 17, 2022

Google is restructuring its in-house incubator Area 120 for innovative initiatives, as it seeks to rein in expenses and narrow its focus on artificial intelligence.

Sources close to the situation said certain Area 120 teams received the alerts this week notifying them their projects had restructured or terminated.

Employees hit by the cuts must find another job at Google within a particular time frame or risk losing their jobs.

One of the people estimated that almost half of the teams at Area 120 had been hit by the layoff.

A company spokesperson said Area 120 “will be shifting its focus to projects that build on Google’s deep investment in AI and have the potential to solve important user problems.

“As a result, Area 120 is winding down several projects to make way for new work.

“Impacted team members will receive dedicated support as they explore new projects and opportunities at Google."

One of the people with knowledge of the matter said Area 120 will continue to incubate new projects.

In recent years, Google has managed redundancies by providing impacted staffers a window to locate alternative jobs.

However, the employees may have an uphill struggle, particularly if the firm reduces overall recruiting.

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Founded in 2016, Area 120 gives a limited set of employees the opportunity to work on small startups that are housed inside Google.

The Area 120 website explains: “Many of Google’s best ideas begin as passion projects.”

One of the incubator's major successes was GameSnacks, a gaming platform introduced in 2020 that targets those using low-memory devices on slow cellular networks.

Nonetheless, Google has signaled to both employees and Wall Street that it will exercise greater financial constraints in the face of a probable economic downturn.

In a July email to employees, Alphabet CEO Sundar Pichai stated that Google will “focus our hiring on engineering, technical and other critical roles” for the remainder of this year and next year.

However, other areas of Alphabet are raising their objectives.

Alphabet's life sciences division, Verily, revealed this week that it had secured $1 billion in new financing spearheaded by its parent company.

Source: Bloomberg

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