Google Radically Restructures, But Why?

On Monday, the search giant founded by Sergey Brin and Larry Page said it’s reorganizing, creating a holding company with that name to give more clarity to its various product lines.

“Fundamentally, we believe this allows us more management scale, as we can run things independently that aren’t very related”, Google CEO Larry Page wrote in a blog post, according to Wall Street Journal.

And while the company’s stock was up about 6% in after-hours trading, what does this news mean for investors? Since its inception, it’s been headed by either one, or both, of its co-founders Larry Page and Sergey Brin.

Google has not filed for a trademark using its new handle, for which the United States Patent Office now lists more than 400 matches, says Marsha Gentner, senior counsel and a trademark attorney at Dykema, a law firm in Washington, D.C. After the restructuring of Google and the creation of Alphabet, a lot of changes will be surely coming, as Google will only be focused in its own products, instead of investing time and effort in their controversial “moonshot” projects.

To consumers, Google will operate much the same, but the company says it will become more transparent about they way it makes and spends money.

Page will become Alphabet’s CEO.

According to the automaker, BMW wasn’t informed about Google’s plans to create the entity with the same name as its subsidiary.

2001: Eric Schmidt is named CEO, with Page and Brin as presidents of products and technology.

Google has picked a name that is also a fairly common brand among American businesses. “So whilst I was reading the news on my phone, sitting in a restaurant, it really felt like a sense of identity was being restored.By making this decentralization explicit, the entities within Alphabet can flourish without the distraction of core business, and Google can slim down and move faster”.

The bank added that the appointment of Sundar Pichai as chief executive officer of the Google unit is a logical and strong choice.

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”.

Google Inc.is changing its corporate structure to separate its search, YouTube and other Web companies from its research and investment divisions. “Alphabet is mostly a collection of companies”. But this is also a company that, for example, owns YouTube, one of the biggest sites on the Internet, and is working on autonomous cars, all-terrain robots, and God knows what else. Now perhaps it will have the opportunity to actually stand on its own.

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.

We’ll tackle each, but as a quick recap: Google renamed and reorganized itself in shock move on Monday afternoon.