Google will get a new CEO, Sundar Pichai, who has been at Google for a decade.
Being the new chief, Google’s advancements in machine learning will also be under Pichai’s leadership and bring the power of supercomputers into smartphones. Today, Google announced plans to create a new public holding company, Alphabet Inc., which will provide reporting for the core Google business as well as its smaller, more speculative segments separately. Projects such as Thread and Nest weren’t mentioned in CEO Larry Page’s letter announcing the restructuring.
“Chennai-born Sundar being made CEO of Google is a great honour for Tamils”.
In a filing with federal regulator Securities and Exchange Commission, Google informed about its organizational restructuring.
While the senior Pichai remembers making careful preparations to furnish Sundar with the 25,000 rupee for airfare, plus additional expenses for living, his son recalls that his parents basically ransacked their bank account to send him to the US. He was tasked with the everyday working of all the Google’s major products including maps, search, and advertising. “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”, explained Page.
Google has assimilated within a new holding company called Alphabet inside, which most of the Google controlled companies, and the search engine giant will now operate. In this case, there is at least one clear connection between the two organizations: BMW is a vehicle manufacturer and Alphabet owns Google, which has a line of self-driving cars.
Waxing eloquent about Pichai, Page said, “Sundar has been saying the things I would have said (and sometimes better!) for quite some time now, and I’ve been tremendously enjoying our work together”.
But the name Alphabet itself is simple and fits with Google’s reputation as being “user friendly and elementary”, says Tom Sepanski, naming and verbal identity director of branding firm Landor. The Stifel team thinks Google shares may even surpass the return of the S&P 500 “for many years” as a result of the new structure. She added, “some analysts have said it now will look a little like Berkshire Hathaway which has got about a hundred companies, a huge conglomerate in all sorts of businesses”.
The parent company Alphabet will have Google, maker of Internet-connected devices for home Nest, high-speed Internet service Fiber, investment arms like Google Ventures and Google Capital and incubator projects like Google X, which is developing self-driving cars and delivery drones.
A nagging problem may be writing about Google, er, Alphabet in the future. Google will report its financial results under the new structure with its fourth-quarter earnings, expected in January.
Page stepped back from managing the day-to-day responsibilities of many of Google’s core products when he promoted Pichai late previous year.
Google is no longer just an Internet company. The stated goal here is to increase management’s scale aspirations, and focus across its consolidated businesses.