Google, which Monday announced it’s reorganizing under a new parent company called “Alphabet”, is one of the biggest and best-known companies in Silicon Valley.
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Google co-founder Larry Page, who authored the announcement, said that, “This newer Google is a bit slimmed down, with the companies that are pretty far afield of our main internet products contained in Alphabet instead”. The company plans to report each segment’s results separately starting in the fourth quarter of this year, Page wrote in a post Monday.
[India-born Sundar Pichai appointed as Google’s new helmsman].
He also talked about expanding Google Play into China, which Google withdrew from in 2010 after a fallout with Beijing over censorship issues.
The post was made after the close of trading yesterday, but after-hours trading saw Google’s stock rise five points.
Judith Hurwitz, an analyst with Hurwitz & Associates LLC, said the move could make the company more structured and disciplined. Alphabet is going to be the parent company of the former, with Sergey Brin serving as the president of Alphabet while Larry Page will be the CEO of the company.
Google’s new chief financial officer, Ruth Porat, will hold the same title for Google and Alphabet. Alphabet, with Google printing cash for it, will likely make a spate of investments in order to build out its major projects.
“Fundamentally, we believe this allows us more management scale, as we can run things independently that aren’t very related”, wrote Page.
Separating the businesses alleviates a concern that multiple media outlets noted has been a thorn in Google’s side: the need to give the company’s stakeholders greater insight into both its money-making operations and its investments in innovation. One of those is the moneymaking Google business that includes the company’s search, advertising, and Android mobile operating system businesses.
“It may not be quite ready yet”, Gillis said of YouTube. Soon after the announcement of Mr Pichai as the new CEO at Google, congratulatory messages started pouring in for the 43-year-old Mr Pichai, who was previously in-charge of product and engineering for Google’s Internet businesses.
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Sundar Pichai, who before ran most of Google’s most important products, will become its CEO. Once the reorganization is complete, the company says its two existing classes of publicly traded stock will continue to trade on the Nasdaq exchange under the ticker symbols “GOOG” and “GOOGL”. The company has come under fire from investors in the past for using Google’s profitable search business to finance moves into riskier areas such as its efforts in Internet balloons or self-driving cars. They’re promising that the new firm will be an “Alpha-bet” bringing market-beating returns to those holding shares, and giving the world access to new tech faster at the same time.
