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Comment by Yhippa | Hacker News Reader

This is very interesting to me. I guess this means Alphabet has enough confidence in Niantic to essentially spin them off. They wouldn't do this if they had negative future prospects right? I honestly had no idea Niantic was this big to warrant spinning them off from Alphabet.

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Companies usually spin things off when they're becoming a distraction for upper management. That doesn't necessarily mean they're big or that management has confidence in them, eg. hello.com is another Google spin-off that hasn't even launched yet.

Or, more likely, Niantic was doing badly (financially) and they wanted them gone. If they were doing well, why would they let them go?

A number of reasons but usually focus. It's amazing how distracting even moneymakers that aren't core to the business are to big businesses.

Doing well or badly financially is usually reflected in the price you are getting for the spin-off. At the right price, even spinning off very profitable parts of your business can be good.

The argument about distraction still holds.

I've always thought Niantic / Ingress was never intended to make a profit, but instead gamify exploration and map routes and whatnot where Google's street maps cars couldn't reach.

Google has a lot of services and products that don't earn them money directly (Chrome is probably the biggest one, Android another), but which do provide Google indirectly - Chrome's initial focus on speed meant lots more page views which caused lots more ad impressions which caused more income. In theory.

Or possibly they're receiving some funding that stipulates not being Google-owned, and everyone just agreed that's the best way forward.

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