Can We Live With Tech Giants’ Recovery Plans?


Google, Nokia, and Intel have all been battered by the recession.They all have plans to recover – but what about the environmental cost, asks Peter Judge

Three giant technology companies, three sets of quarterly results, and three more plans to get out of recession. But what will we learn from this week’s results?

Google, Nokia and Intel are all pre-eminent in their field, and all have been hit by the general recession. All of them posted disappointing sets of results this week, but all of them found reasons to be cheerful . And all of them pointed to different ways to move on in future.

Google’s income actually carried on growing, increasing by 8.9 percent in the first quarter of this year, but its sales were down, for the first quarter ever. It stayed profitable by cutting costs, reducing its research and development budget, marketing, and side projects.

That’s something you can’t keep doing for ever. Lower R and D will mean fewer of the things that stoke public interest in Google, like Street View, and push it to more aggressive use of the contextual ads it still makes almost all its money on.

Google’s dominance of search will be a cause for concern in future, especially as it is continuing in new markets (it has 97 percent of mobile search, even before its Android platform is widespread). And Google itself should be worrying about how to diversify into other things. It’s still benefitting from advertising which is moving to the web from other media, but the overall downturn in advertising must hit it sooner or later.

The stock market is still on Google’s side, and that’s also the case for Nokia, despite one of the most shocking headline figures ever: a 90 percent slump in profit. The phone company gets credit for reducing its costs, and is predicting stability in future – and investors are also still keen to see what the phone giant can do when it finally comes out with something to compete with Apple’s iPhone.

Nokia’s business phones are highly regarded, and the next one coming down the pike, the E75 has got favourable reviews. After the somewhat experiemental 5800, the much-delayed high-end touch phone from Nokia will be out by the end of the year, we are told.

Lastly Intel, whose status as the bellwether of the tech world is long-established. Paul Otellini’s claim to see signs of recovery has been much reported, and is somewhat undermined by Intel’s failure to give any guidance on what will happen in the future.

Whether things get better for Intel will depend on the success of its Nehalem process family, along with Atom in mobile machines. Much of that is now based on convincing users of the need to replace existing machines – installing lower-energy, higher-power servers, and replacing desktops with newer laptops, – and add new ones, for instance having a netbook alongside the laptop.

All these strategies are efforts to restart growth – and beg the question of sustainability.

Intel needs to sell millions of server and client chips, which somewhat undermines its words about how much lower their individual carbon footprint will be. More new servers equals more resources used, however you slice it.

Nokia’s downturn has come partly because users and operators alike have found they can do without endless upgrades for a while. To get its business going again, the Finnish phone maker will have to convince people they do want new phones.

And even Google’s hopes for growth must mean more searches made and (according to controversial calculations) the carbon equivalent of more kettles being boiled.

Next week we’ll have results from Yahoo and Microsoft, and we’re expecting the same story – downturn, and plans to get out of it.

At some point, we will have to face the question of whether we actually want the environmental consequences of getting out of this recession.

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