Under the changes, announced Monday, Google co-founder Larry Page will become CEO of Alphabet.
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“Our company is operating well today, but we think we can make it cleaner and more accountable”, said a statement from Page, a co-founder of the tech giant with Sergey Brin. He has really stepped up since October of last year, when he took on product and engineering responsibility for our internet businesses.
Page wrote: “Sergey and I have been super excited about his progress and dedication to the company”. Page explained that Google will be slimmed down as spinoffs become their own companies.
The two aren’t letting go of the company however.
Google Inc is changing its operating structure by setting up a new company called Alphabet Inc, which will include the search business and a number of other units. Google shares will be converted into equivalent stock holdings in Alphabet, with the same rights – or lack of them.
Larry Page just announced this new parent company for Google and all of its various offspring. What do we mean by far afield? Google stock will become Alphabet stock, and everyone will be confused about this means for a little while. Alphabet will also be home to investment arms, Ventures and Capital, which Page says he looks forward to growing in the future.
Before getting into that, it is clearly frustrating for investors to watch Google spend lots of its cash on science projects – like Google Glass and self-driving cars – that seem always to avoid turning into another big revenue source for investors. Google will be a wholly owned subsidiary of Alphabet. The largest of which, of course, is Google. What do we mean by far afield? Other efforts will be run separately, including health efforts such as Life Sciences, which works on glucose-sensing contact lenses, and Calico, focused on longevity. So they hand off the day-to-day business dealings of their advertising empire to a safe (if uncharismatic) pair of hands and start playing with all the new toys their billions will buy.
Page said the companies would all retain a great deal of independence and be run by strong CEOs.
Investing at the scale of the opportunities and resources we see.
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The Google business will retain search, ads, maps, apps, YouTube and Android – though no mention has been made of Chrome OS, it’s logical for the business to remain under Google’s control rather than be spun off into a new venture.
