Today it was announced by Google Inc. that they will be starting a new parent company called Alphabet. The company will be run by Larry Page and Sergey Brin, two of Google’s founders. Alphabet will replace Google Inc. as the business that is traded on the stock market.
“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,” wrote Google co-founder and current CEO Larry Page in a post to the official Google blog. Page will become CEO of Alphabet and co-founder Sergey Brin will become president. “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.”
Also part of the move, Page will take over as CEO of Alphabet, who’s URL will be ABC.xyz. Sundar Pichai, currently Page’s deputy at Google, will take over as CEO of Google. Current chairman, Eric Schmidt, will become the Executive Chairman and Ruth Porat will be the Senior Vice President and CFO of the new company.
“For Sergey and me this is a very exciting new chapter in the life of Google — the birth of Alphabet. We liked the name Alphabet because it means a collection of letters that represent language, one of humanity’s most important innovations, and is the core of how we index with Google search! We also like that it means alpha-bet (Alpha is investment return above benchmark), which we strive for! 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.”
The leader in search engine marketing will continue to run internet-centric services such as Google Maps, YouTube, Chrome, and Android. But exploratory projects such as the X Lab and the Calico life extension project will operate as different entities.
The move comes as no surprise as Wall Street is once again in love with Google, following a strong earnings report and the hiring of a top-notch CFO. Investors appeared to cheer the introduction of Alphabet: Google stock jumped 5% hours following the announcement.
The purpose of this is to create a more robust portfolio of business, each with its own dedicated CEO, under the “Alphabet” umbrella. Essentially, they want to run a collection of smaller companies rather than one big monopoly.
In a press release released this afternoon, Larry Page identified 9 priorities and they are:
- Getting more ambitious things done.
- Taking the long-term view.
- Empowering great entrepreneurs and companies to flourish.
- Investing at the scale of the opportunities and resources we see.
- Improving the transparency and oversight of what we’re doing.
- Making Google even better through greater focus.
- And hopefully … as a result of all this, improving the lives of as many people as we can.
Does this mean goodbye Google? What’s your take on this new development?
About Alex Noudelman
Alex Noudelman is an educator, coach and Digital Marketing Manager with over 5 years of experience. Alex enjoys and strives to motivate others to better themselves professionally and one a personal note. Feel free to contact him if you have any questions or would like a specific topic covered.