Why can’t companies like Google, Apple, and Microsoft find ways to spend the tens of billions of dollars they have in the bank? That’s the question Peter Thiel asked of Eric Schmidt at a recent event. The fact that these huge sums of money are being parked by the biggest companies in technology is a problem for US productivity and employment and it’s a sign that the pace of innovation in tech is not where it needs to be.
That said, even if good ideas abounded, it would be difficult to put the money that’s already in the bank to use quickly. Even $1 billion is a lot of money to spend. You could use it to hire more than 5,000 engineers for a year. What would you put them to work on? How would you even scale up such a team if you had a project? There just aren’t that many shovel-ready projects available.
Apple put another $7.2 billion in the bank this quarter. That’s a symptom of something.