parentshiftbook Chapter 188 Sudden Event
Chapter 188 Sudden Event
Chapter 188 Sudden Event
Ernst and Hamilton talked about many things, not only the technical dispute over Google Video, but also the details of the recent organizational restructuring implemented within the company to improve operational efficiency, the changes in team atmosphere after the large-scale onboarding of new employees, and the latest developments in various businesses.
"I'm thinking of organizing an internal Google sports event. What do you think?"
Ernst instantly understood Hamilton's intention. He picked up his coffee cup and gently swirled it, the coffee grounds at the bottom of the cup creating irregular patterns.
"You want to use the sports meet to help new employees integrate into the existing system more quickly, right?" He looked up at Hamilton, a hint of understanding in his eyes.
Hamilton nodded, leaning forward slightly, his tone tinged with a hint of helplessness. "The rate at which new employees are joining has been too fast lately, like a floodgate opening, completely out of control. The number of new employees in the company is now almost twice that of the long-term employees."
"If you go to any of the technical teams, you'll see that the previously stable team structure has been completely disrupted. Many long-term employees come to the office in the morning, look around, and find that they don't recognize more than half of the people around them. That sense of unfamiliarity is no different from when they first joined the company."
Ernst sighed. This was the problem brought about by the drastic change in personnel structure.
Technical teams need a long period of adjustment to develop an efficient collaboration model. However, the influx of a large number of new employees has not only affected the speed of project progress but also significantly increased the communication costs within the team.
"Holding a sports meet is indeed a good idea. This kind of group activity allows employees from different departments and levels to get to know each other in a relaxed atmosphere. Compared to a serious self-introduction in a meeting room, it can quickly shorten the distance between employees and build team chemistry."
"Especially for new employees, this helps them find a sense of belonging and become familiar with the company culture more quickly."
"However..." Ernst hadn't finished speaking when a rapid knocking on the door suddenly interrupted their conversation.
"Go in," Ernst replied in a deep voice.
The office door was flung open, and Sergei Brin rushed in in a flustered manner.
Before he had even fully entered the room, his anxious voice had already drifted in, "Quick! Quick, check the ABC news! Something terrible has happened!"
Before Ernst and Hamilton could react to the sudden interruption, Sergei had already strode to the television in the corner of the office, grabbed the remote control, and pressed the power button forcefully.
The TV screen flickered a few times, and soon ABC News' live broadcast appeared.
In the video, a female reporter in a business suit stands in front of a modern building, with America on the background wall.
The Online logo is particularly eye-catching.
"Viewers, I am currently at the headquarters of AOL in Vienna, Virginia. Just fifteen minutes ago, Netscape CEO Jim Clark made a surprise visit. According to reliable sources, the core purpose of Jim Clark's visit is to discuss a merger with AOL."
"If both parties can reach an agreement in these negotiations, this deal will become the largest acquisition in the history of the internet industry. Our reporter will continue to be on-site to bring you real-time updates on the progress."
With a "whoosh," Ernst and Hamilton stood up from their seats almost simultaneously, their relaxed expressions vanishing instantly, replaced by solemn ones.
The air in the office seemed to freeze at that moment, with only the echoing voice of the reporter continuing to report on the television.
Sergei Brin pressed the television switch, the screen went black instantly, and the office returned to silence.
He turned around, his gaze fixed on Ernst, and said in a heavy tone, "Things are getting complicated. Once AOL and Netscape merge, our carefully crafted Normandy plan will likely have to be completely altered."
"Yes, it is indeed troublesome." Ernst slowly sat back in his chair, crossed his arms in front of him, and frowned deeply.
He leaned back in his chair, closed his eyes, and his mind raced through various pieces of information.
He didn't expect that AOL would enter the game so early.
This internet company, founded in the early 82s, started as a small company providing components for game consoles. In 1985, it changed its name to Quantum Computer Corporation, and its main business became providing dial-up internet access.
In October 1989, it was officially renamed America Online, abbreviated as AOL.
AOL founder Case was a true nobody who worked in places like fast food restaurants in his early years.
It was this experience that made Case understand that no matter how good the technology is, if it is not practical, it will be eliminated by the market. People like convenient and simple things, and technology is no exception.
Therefore, he founded AOL, which provides convenient and fast online services to people, selling convenience and speed to consumers.
In the early 90s, as the Internet began to become widespread, AOL's business took off, becoming the largest Internet service provider in the United States, with its user base quickly exceeding 1000 million.
For many people, AOL is synonymous with the internet. Without AOL software, they wouldn't know how to play online games, chat, or send and receive emails.
Because of its booming business, there was a period when it was difficult to get through to the customer hotline, leading the press to jokingly refer to AOL as "AIways".
Off-Line, always busy.
In 1992, under Case's leadership, AOL, with only 120 employees, went public on the New York Stock Exchange, raising $6600 million.
The IPO fueled Case's ambitions, and he set out to build AOL into a company as big as Microsoft.
AOL then began a frenzied expansion of its business, continuously increasing the company's assets through mergers and acquisitions and new ventures.
First, there's the Google Play service. While other companies still had little concept of Google Play, AOL had already begun implementing its own Google Play strategy.
Because online Google services are much cheaper than on TV or in newspapers, many users choose to partner with AOL, including Amazon.
AOL has also ventured into the social networking industry, boasting the world's largest chat community.
As of last year, AOL had more than 14000 chat rooms running every day, with an average of 23 people in each chat room.
In March of this year, AOL opened 14000 of its chat rooms to Google, making it the most profitable company in the internet industry.
Even so, AOL's market value has remained stagnant because of low profits and a business model that lacks the imaginative appeal of companies like Netscape, Yahoo, and Google.
Currently, AOL's stock price is less than four dollars per share, and its market capitalization is only over $110 billion. Even at the peak of the dot-com bubble, AOL's price-to-earnings ratio could not compare with that of internet companies such as Microsoft, Cisco, and Yahoo.
Ernst was well aware of the key reason: the problem lay in the business structure.
AOL's core business is internet access services. Although it is currently the largest internet access provider in the US market, competition in this field is extremely fierce, with a large number of competitors in the market.
More importantly, internet access services are fundamentally different from those of true internet content service providers like Google and Yahoo.
Its operating costs are extremely high, requiring the construction of a massive network infrastructure, including servers, transmission lines, etc., all of which require continuous and huge investments and payments to the corresponding providers.
Moreover, in order to attract users, the company needs to continuously reduce access fees, which further squeezes profit margins.
However, none of this concerns Ernst. What he is considering now is the impact on Netscape and Google once the two companies merge.
Hamilton was well aware of the seriousness of the matter, and said in a heavy tone, "Netscape's market share is now less than 30%, a far cry from its former industry dominance. It's like a spent arrow. But with the traffic support of AOL, the situation will be completely different."
Ernst nodded and added, "Netscape offers a monthly subscription service, and AOL's core business is also monthly internet access. If the two companies merge, they will likely integrate their user account systems. At that time, users will only need to pay one fee to enjoy both AOL's access service and Netscape's browser service."
"As a result, Netscape's market share will definitely increase significantly. Although on the surface, the revenue of the two companies may decrease due to the merger and the introduction of new fees, the rapid increase in the number of users can completely offset some of the losses."
The key is the market. Once the browser market is unified, industry rules can be set at will.
"There's also the issue of funding," Sergey Brin said, sitting down beside him. "Netscape's cash flow is very tight right now, but AOL has a clear advantage in terms of funding. Its profit model is very stable, and its cash flow is relatively abundant."
Silence fell in the office again as the three of them pondered their next move.
Ernst leaned back in his chair, staring intently at the ceiling. After a long while, he slowly spoke, "I'm not worried about these things now."
This statement stunned Hamilton and Sergey Brin. They both turned to look at Ernst, their eyes filled with doubt, waiting for his further explanation.
Ernst sat up straight and said in a serious tone, "What I'm most worried about right now is that this already fierce browser war may turn into an endless money-burning war."
AOL has a stable source of funding, while Netscape has mature browser technology and a certain user base. The merger would make AOL's business more promising and boost its stock price.
Once Netscape, like Microsoft, starts throwing money at the market to grab market share, Google will inevitably be dragged down with it.
In a three-way battle, the cost of competition across the entire industry will be driven up, resulting in a spending spree even more intense than the rivalry between Microsoft and Google.
"And..." Ernst hadn't finished speaking when a sudden, urgent phone call broke the silence in the office.
Ernst took out his phone, saw the caller ID on the screen, and a bitter smile appeared on his face.
He looked up and said helplessly to Hamilton and Sergei Brin, "And the people who are forcing us to abdicate have already arrived."