The Google Alphabet Restructuring And Why It Doesn’t Matter
Yesterday Larry Page took to the Google blog to make a pretty big announcement; Google is no longer Google. For a company that is so deeply ingrained into the culture of the internet, it’s difficult for anything like this to not cause a stir. Of course, some [rather stupid] commentators have gone so far as to call this move a “preparation for….Google’s almost inevitable collapse.” Because, you know, that makes sense. In essence, the announcement made by Mr. Page yesterday means absolutely nothing, so you may as well stop reading now.
What Is Google Alphabet?
More accurately, ‘what is Alphabet Google?’ It’s going to seem strange for a while not calling the major corporation that makes all of the cool things on the internet Google, but it’s not anymore – though it sort of is. Google, Inc. has changed their name to Alphabet. However, the Google search engine, Google apps and services and even Google X are keeping the Google name. The main difference is that Alphabet is now the parent company that handles a handful of smaller companies, including Google.
Alphabet will now be the company that is being traded on the stock market, but the names will not change. GOOG and GOOGL will still the publicly traded stock symbols, but those refer to shares of Alphabet, which were once shares of Google, Inc.
To quote Page’s post from yesterday, “I should add that we are not intending for this to be a big consumer brand with related products—the whole point is that Alphabet companies should have independence and develop their own brands.” So really, Alphabet won’t have any consumer products or be a consumer-facing company, it’s just the company that manages a bunch of smaller companies that have their own management structures and their own CEOs, even.
The subsidiaries of Alphabet are:
- Google, which includes YouTube, Android, Chrome, Apps, and of course, Search
- X Labs
- Fiber
- Ventures
- Capital
- Nest
- Calico
This allows companies that Alphabet has acquired to operate independently from other formerly Google companies. Speaking of CEOs, Google has been appointed a new one. Alphabet is going to continue to be headed by CEO Larry Page and President Sergey Brin, but Google’s new CEO is the former SVP of Android, Chrome, and Apps, Sundar Pichai. As Page points out in the letter introducing Alphabet, Sundar has really proven himself over the last couple of years and anyone paying attention to what’s been going on could probably have told you that Sundar was being groomed for CEO. I don’t think any of us saw this particular chain of events leading to that happening, but he now sits in the throne formerly occupied by only Larry Page and Eric Schmidt, at least sort of.
At the end of the day, though, nothing is really changing. Google is still Google, they just have fewer things to worry about, meaning that their services will have the opportunity focus more on their own tasks and become a lot better. See, I told you it was time to stop reading.