Alphabet CFO Ruth Porat


Google is asking cloud employees and partners to share their desks and alternate days with their deskmates starting next quarter, citing “real estate efficiencies,” CNBC has learned.

The new desktop sharing model will apply to Google Cloud’s five largest US locations – Kirkland, Washington; New York City; San Francisco; Seattle; and Sunnyvale, Calif. — and it’s happening so the company “can continue to invest in the growth of Cloud,” according to an internal FAQ recently shared with Cloud employees and seen by CNBC. Some buildings will be evacuated as a result, the document noted.

“Most Googlers will now share a desk with another Googler,” the internal document said, noting that they expect employees to come in every other day so they’re not at the same desk on the same day. “Through the matching process, they will agree on a basic desktop configuration and establish norms with their desktop partner and team to ensure a positive experience in the new shared environment.”

For anyone coming in on their unallocated days, they will use “overflow drop-in space”.

Internally, management has given the new seating arrangement a title: “Cloud Office Evolution” or “CLOE,” which it describes as “combining the best of pre-pandemic collaboration with the flexibility” of hybrid work. The new workplace plan is not a temporary pilot, the document noted. “This will ultimately lead to more efficient use of our space,” it said.

Google also used its internal data it has on its employees’ return patterns to inform the decision, the FAQ said. In addition to slower office return patterns, the company has slowed hiring and dismissed 11,000 employees in January.

Memes began appearing on the company’s platform Memegen touting the change – specifically targeting the “corpspeak” used by management to tout the new desk arrangement in what they believed to be a cost-cutting measure.

“Not all austerity measures need to turn out to sound good to employees,” read a popular meme. “A simple ‘We’re reducing office space to reduce costs’ would make leadership sound more credible.”

Google did not immediately respond to requests for comment.

The move comes as Google shrinks its real estate footprint amid broader cost-cutting efforts. But it has not yet specified the regions or buildings it plans to cut.

In its fourth quarter earnings call, Google executives said they expect costs of about $500 million related to reduced global office space in the current quarter, and warned that other real estate charges are possible going forward. Earlier this month, SFGate reported the company will terminate leases for “a number of vacant spaces” in the San Francisco Bay Area, the region where its headquarters are located.

The cloud unit, which makes up more than a quarter of Googles full-time employees, is among the areas with the highest growth at the company, but is not profitable.

In the fourth quarter, Google Cloud brought in $7.32 billion, up 32% from a year earlier, significantly faster than the company’s overall growth rate of less than 10%. But that revenue figure was less than Wall Street expected, and the cloud unit is still losing hundreds of millions of dollars each quarter — $480 million in the fourth quarter, though that was nearly half the loss a year earlier.

Overall, however, Google earned $13.62 billion in net revenue for the quarter and $59.97 billion for all of 2022. Both were significant declines from 2021.

Welcome to the “neighborhood”

Under the new arrangement, teams of 200 to 300 employees “and partners” will be organized into “neighborhoods” that may also include “partner teams that are part of other organizations, such as finance, human resources, etc.,” the FAQ read. Each neighborhood will have a vice president or director who will be responsible for allocating space in the neighborhood.

Employees will usually alternate the days they are in the office, either Monday and Wednesday, or Tuesday and Thursday. They will be two days a week, a change from the company that requires employees to come in three days a week.

“Leaders in the neighborhood are encouraged to set norms with their teams around shared desks, to ensure that pairs of Googlers have conversations about how they will or will not decorate the space, store personal items, and expectations for cleanliness.”

Additionally, the FAQ said that employees with computer workstations will no longer have those workstations located directly under their desks, but will instead have to look up their location in a database or file a ticket for troubleshooting. Over time, employees are expected to transition to CloudTop, a virtual desktop tool that is so far reserved for Google employees only.

The FAQ said it will also put a cap on the number of rooms to be taken for meetings, noting that conference rooms are “already difficult to book.” Employees will be discouraged from “camping out” in a conference room, it added.

In the case of Covid-19, desks will be sanitized daily and employees will receive a notification if someone in their area tests positive and report it to Google.