Appen, an Australian data services company with a big agreement with Google that provides a large workforce for its third-party search quality raters, received an unexpected notification from Google.
According to the notification, Google will end its contract with Appen on March 19, 2024.
Australian Data Services Company
This abrupt termination took Appen off guard because they had gotten no prior information or indication of Google’s decision.
The ramifications of this cancellation are significant, with Appen anticipating a stunning loss of $82.8 million in revenue, resulting in a 26% gross margin for the company.
Google’s quality raters play an important part in determining the quality of Google search results.
It is vital to note that these raters have no direct influence or manipulation over the search results itself. In other words, they do not have the authority to demote or raise certain websites in Google Search ranks.
According to Google,
Search quality rater guidelines are used by our search raters to help evaluate the performance of our various search ranking systems, and their ratings don’t directly influence ranking.
The guidelines share important considerations for what content is helpful for people when using Google Search.
Appen stands out as one of Google’s preferred partners for contracting these quality raters.
Given the huge revenue amount of approximately $83 million, it is logical to assume that Google hired Appen to onboard a large number of raters.
For comparison, Google has stated that it employs around 16,000 search quality raters in total. As a result, Appen-contracted raters make up a significant fraction of the overall staff responsible for judging search quality.
It is unclear whether Google is replacing its human quality raters with AI technologies, but given that the business recently cut off hundreds of Ads employees in favour of AI, it is not difficult to envision.
11th layoff notice in a year
More recently, the business cut off scores of employees from its X Labs, marking the search engine giant’s eleventh layoff announcement in a year and fourth this month.
X Labs is the company’s experimental products division, which focuses on concepts rather than commercial objects. It wastes approximately a billion dollars per quarter and generates no profit, making it an ideal target for job layoffs.
The internal business memo announcing the layoffs includes more information than just the firings:
We’re expanding our approach to focus on spinning out more projects as independent companies funded through market-based capital.
We’ll do this by opening our scope to collaborate with a broader base of industry and financial partners, and by continuing to emphasize lean teams and capital efficiency.
In essence, Google seeks to encourage these financially unsustainable companies to seek alternate funding sources, albeit to varying degrees.
To read our blog on “Google will stop hosting Business Profile webpages in March,” click here
