Text size

When Google reorganized into Alphabet in late 2015, founder and CEO Larry Page promised investors that “We will rigorously handle capital allocation and work to make sure each business is executing well.” In other words, we won’t waste your money. Robots have now become a casualty of that discipline. Last week, Alphabet announced it was selling Boston Dynamics, its advanced engineering and robotics unit, to Japan’s Softbank.

The sale -- terms were not disclosed -- reflects an effort by the company to prioritize subsidiaries with a clear path to profitability in the future such as the autonomous driving division Waymo or life sciences-focused Verily. Boston Dynamics has struggled to achieve similar success under the Alphabet umbrella.

You’ve probably seen videos on YouTube of Boston Dynamics’ bipedal and quadruped robots running, jumping, and staying upright after a shove.

The Waltham, Mass.-based company was spun off from the Massachusetts Institute of Technology in 1992 and has worked extensively with the U.S.. military’s Defense Advanced Research Projects Agency (DARPA) on robots capable of eerily lifelike navigation of difficult terrain and conditions. The Andy Rubin-managed Replicant robotics initiative at Alphabet acquired Boston Dynamics in 2013, but Android-creator Rubin left the company a year later to start Essential, putting Boston Dynamics’ direction in question.

Additionally, Alphabet’s policy against taking contracts from the military hamstrung Boston Dynamics’ ability to find willing customers for their creations. That policy -- combined with Rubin’s departure -- left the research shop struggling to generate enough revenue to cover expenses and without a leader and advocate at Alphabet. In March 2016, Bloomberg first reported rumors that Boston Dynamics was up for sale.

Over a year later, Softbank has come forward. The Japanese telecom and tech giant has made numerous acquisitions lately as part of its $100 billion tech investment “Vision Fund.” Recent deals include a $32 billion deal for British chip designer ARM Holdings, a $300 million investment in shared office space startup WeWork, and $5 billion put into Chinese Uber-equivalent Didi Chuxing. As part of the deal for Boston Dynamics, SoftBank also receives the lesser-known Japanese robotics company Schaft, a producer of bipedal robots.

“Today, there are many issues we still cannot solve by ourselves with human capabilities,” SoftBank Chairman and CEO Masayoshi Son said in a statement announcing the deal. “Smart robotics are going to be a key driver of the next stage of the information revolution, and [CEO and founder] Marc [Raibert] and his team at Boston Dynamics are the clear technology leaders in advanced dynamic robots. I am thrilled to welcome them to the SoftBank family and look forward to supporting them as they continue to advance the field of robotics and explore applications that can help make life easier, safer, and more fulfilling.”