The organisation is now going to be restructured into a new holding company called ‘Alphabet’ and will be the largest subsidiary of its new parent company.
Larry Page and Sergey Brin announced the shake-up of the company through a blog post on Monday evening. The new company, Alphabet, will preside over a collection of organisations and Google itself will be under the new management of Sundar Pichai.
“Our company is operating well today, but we think we can make it cleaner and more accountable. So we are creating a new company, called Alphabet. I am really excited to be running Alphabet as CEO with help from my capable partner, Sergey, as President” announced Larry Page.
“What is Alphabet? Alphabet is mostly a collection of companies. The largest of which, of course, is Google. 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. What do we mean by far afield? Good examples are our health efforts: Life Sciences (that works on the glucose-sensing contact lens), and Calico (focused on longevity),” he continued.
Fundamentally, we believe this allows us more management scale, as we can run things independently that aren’t very related.”
“Alphabet is about businesses prospering through strong leaders and independence. In general, our model is to have a strong CEO who runs each business, with Sergey and me in service to them as needed. We will rigorously handle capital allocation and work to make sure each business is executing well. We’ll also make sure we have a great CEO for each business, and we’ll determine their compensation.”
All shares in Google will now automatically convert to shares within Alphabet but will still be trading under the stock ticker symbols GOOG and GOOGL.
“Google is not a conventional company. We do not intend to become one.”