“Our company is operating well today, but we think we can make it cleaner and more accountable”, said a statement from Page, who co-founded the tech giant with Sergey Brin 17 years ago.
In a surprising move, the technology titan on Monday announced that it is now rebranding itself as Alphabet – a new holding company whose largest wholly owned subsidiary will be Google. Google has created a new mother company, Alphabet, and Google Founder Larry Page will be its CEO. Technically, they still will, but they’ll have a level of detachment that should make their jobs (and their company) more manageable. With the new structure, Google operates as a leaner organisation that can focus on the core internet products that it cut its teeth on.
The aim of the operating overhaul is to allow Google to focus on developing its own products, while enabling other Alphabet subsidiaries with the independence to further their own brands.
In addition to Google X, Alphabet will oversee independent operations by health research firm Calico, home appliance developer Nest, broadband provider Fiber, and corporate investment entities Google Ventures and Google Capital. However, those shares will still trade as GOOGL and GOOG on NASDAQ. Financial experts seem rather impressed with Page’s new move, as it’ll offer investors and shareholders more transparency about some of Google’s ambitious and experimental business units. The Google co-founder added that the name also refers to “alpha bet”, on which alpha means an investment term used to describe returns that are above the set benchmark. Dividing Google’s diverse portfolio will reportedly push leaders and spinoff companies to become more particular about what happens to their bottom lines.
Robin Richmond, managing director of Edinburgh-based digital marketing agency 8 Million Stories, said consumers were unlikely to see major changes under the shake-up, with popular products and apps such as YouTube, Gmail and Google Maps retaining their familiar look and names. According to him, Google isn’t a conventional company, it never was, and it can never be one. There are some who are crying foul accusing Page and Brin of simply trying to avoid any EU anti-trust measures by creating a “shell corporation”. The restructuring announcement caused Google shares to jump five percent. With more than 11,000 employees in town and plans to hire many more in near future, Google plays a significant role in almost all aspects of city management.