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Google changing operating structure, it will be part of holding company Alphabet

Justin Sullivan-Getty Images Google senior vice president of product Sundar Pichai delivers the keynote address during the 2015 Google I/O conference on May 28, 2015 in San Francisco, California.

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Tech giant Google on Monday announced plans for a new operating structure, including a new holding company called “Alphabet”.

Larry Page will be Alphabet’s chief executive officer, while co-founder Sergey Brin will be president. Our two classes of shares will continue to trade on Nasdaq as GOOGL and GOOG. Sundar Pichai, Page’s deputy, will be promoted to become CEO of Google Inc., which generates the bulk of Google’s $60 billion in annual revenue.

The announcement came with news that Google is rebranding itself as Alphabet, a “collection of companies”, the largest of which is Google. What do we mean by far afield? Entities include its Life Sciences team which focuses on its glucose contact lens, and longevity exploration team at Calico.

“Fundamentally, we believe this allows us more management scale, as we can run things independently that aren’t very related”, Page wrote in a blog post Monday.

Okay! So Alphabet implies control over all communication and the future of business growth.

YouTube has long functioned as its own company with its own CEO under Google with great success, so it seems like a logical step for the rest of the widely varying Google properties to take the same approach.

Why did Larry Page and Sergey Brin decide to call this new company, Alphabet? All the Alphabet subsidiaries, including Google, will be using “segment reporting” to report their financial results separately as well.

Unusual day but there you have it. Google is now part of Alphabet.

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Improving the transparency and oversight of what we’re doing. No wonder we are excited to get to work with everyone in the Alphabet family.

Google changing operating structure, it will be part of holding company Alphabet