Google forms a new holding company, ‘Alphabet’

“I remember the early days when Google wasn’t so big (well it was still massive), in those days Google would have awesome parties where Larry and Sergey would just mingle with search marketers”.

Tech geeks in China looking to understand Google’s newly unveiled corporate structure are out of luck: the website of the new parent company, dubbed Alphabet, was blocked less than 24 hours after going live.

Businesses that will operate separately under the Alphabet umbrella include Calico, which Google established to conduct health research in 2013; Nest, which Google acquired in 2014; Fiber, which is building high-speed broadband networks in several cities; and Google X, the research lab responsible for Google’s self-driving auto venture and previously developed its controversial Internet headset, known as Glass.

Google co-founder Brin will become president of Alphabet, and Eric Schmidt will be executive chairman. All three of them have been with the company for quite some time, with Alegre being their the shortest, still at almost 8 years.

“They are aware that they’ve got this hodgepodge of companies”. The analyst, who sees the change giving investors more clarity around the core business’ profitability and growth of some of its longer-term investments, compares the set-up for Google’s stock to Amazon (AMZN) ahead of its separate disclosure for its AWS segment.

The Alphabet companies will retain their current leadership.

Hence, we have to look at financial reasons, and I think there are a couple of them here.

THE NEW YORK TIMES reports, “GOOGLE’s move is the most significant step by a SILICON VALLEY giant to get a handle on the sprawl of businesses that it has entered, an issue that increasingly afflicts other technology companies like FACEBOOK and AMAZON”.

The news of the sweeping reorganization of the search giant came along with naming Sundar Pichai as the new CEO at Google.

Porat will serve as the CFO of both Alphabet and Google. Sundar Pichai, formerly Google’s vice president in charge of products, will serve as CEO of Google. And yet, here we are facing the prospect of a conglomerate called Alphabet owning Google and a variety of other unconnected businesses.

With Google co-founder Larry Page heading up Alphabet, Sundar Pichai, a long-time Google executive who most recently served as the company’s senior vice-president of products, will head Google.

The biggest of these will be the search engine Google, including Google Play, YouTube, Chrome, Google Maps and Android.

Roger Kay, an analyst with Endpoint Technologies Associates, said the new structure “makes a lot of sense to me because it creates a greater degree of flexibility”. Experts believe that Indians’ focus on good education and ability to work in hard situations are aiding to this rising trend and more and more Indians could rise to top positions at global companies in near future.