Institutional investors are mostly not tuned into the Google zeitgeist even though they own major positions.Â As possibly the most over-followed company on the planet Google investors will hear about every little ripple of information.
The weirdness stems from the Google culture where engineers can spend time doing pet projects and see the show up as offerings in Google Labs or even as "beta" products in the Google portfolio.
When Google comes out with something like Lively it gets looked at and generates not only puzzled looks but some concerned questions of whether Google has "lost its way."Â The fact is that Google throws quiet a bit at the wall to see if it sticks.Â Plenty doesn’t make the cut but none (or very very few) are like Microsoft Vista or Adobe Creative Suite.Â For Google and other SaaS styled companies it’s not about product cycles.Â New products, particularly strategic ones do have a role to play and bear watching closely.
The problem is that many mainstream investors have a hard time sorting out the important aspects of what’s going on at Google from the unimportant ones.Â Offsetting the difficulty in separating the wheat from the chaff is a blissfully short memory that generally means any Google weak launches or eventual failures are forgotten quickly.
Google remains an essential portfolio holding as they are perhaps the best technology architecture for modern computing although they occasionally put out some stinkers.Â (Requires Windows XP and Internet Explorer?!)
Developing a good feel for Google as an investment requires an ability to make more "doesn’t matter" decisions than we have seen with any technology company in the past.