Google Shuts Loon hot air balloon project

OAKLAND, Calif. Alphabet, Google’s parent company is shutting down Loon, a famous subsidiary spun off from its research laboratories, using a high-altitude helium balloon to provide cellular connectivity from the floor. circulation.

Almost a decade after starting the project, Alphabet on Thursday said it had pulled out of Loon because it had not found a way to reduce costs to create a sustainable business. Along with the self-driving car unit Waymo, Loon is one of the most hyped “famous” technology projects from Alphabet’s X.

“The road to commercial viability has proven to be much longer and risky than expected. So we made the tough decision to shut down Loon, ”Astro Teller, head of X, wrote in a blog post. Alphabet said it is expected to cease operations in “the coming months” in hopes of finding other positions for Loon employees at Alphabet.

The idea behind Loon is to bring cellular connectivity to remote parts of the world where building a traditional cellular network would be too difficult and too expensive. Alphabet has been promoting this technology as a promising way to bring internet connectivity to not only the “next billion” but the “last billion”.

Huge helium balloons, made from sheets of polyethylene, the size of tennis courts. They are powered by solar panels and are navigated by flight control software that uses artificial intelligence to efficiently drift in the stratosphere. When in the air, they act as “floating cell towers”, transmitting internet signals to ground stations and personal devices.

Google started working with Loon in 2011 and launched a public test project in 2013. Loon became an independent subsidiary in 2018, a few years after Google became the parent company called Alphabet. In April 2019, it accepted a $ 125 million investment from a SoftBank unit called HAPSMobile to promote the use of “high altitude vehicles” to provide internet connectivity.

Last year, it announced the first commercial rollout of the technology with Telkom Kenya to provide 4G LTE network connectivity to an area of ​​nearly 31,000 square miles across central and western Kenya, including the capital. Nairobi. Before that, balloons were used only in emergencies, such as after Hurricane Maria knocked out Puerto Rico’s mobile network.

However, Loon has started running out of money and has switched to Alphabet to keep the business solvent while looking for another investor in the project, according to a November report in The Information.

Loon’s decision to shut down is another signal of Alphabet’s recent austerity over its ambitious and costly technology projects. Under Alphabet’s chief financial officer Ruth Porat since 2015, the company has been keeping a close eye on the finances of the so-called Other Bets, a nascent business project aimed at diversifying its core advertising business. your core.

Alphabet has been actively promoting its “Other Bets” as Waymo and Verily, a life science unit, accept outside investors and self-affiliates. Projects that fail to secure outside investment or show enough financial promise have been scrapped, such as Makani, the wind-powered kite production project Alphabet shut down last year.

That austerity is a notable shift from a time when entities like X, which is a frivolous project of which Google co-founders Larry Page and Sergey Brin, have autonomy. Spend freely to chasing ambitious technology projects even when the financial prospects are still unclear. .