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Re-brand for technology giant

Google spells out future with new Alphabet name

googleGoogle co-founder Larry Page announced after US trading closed that the search engine company’s corporate name was changing to Alphabet.

In a statement that took the markets by surprise Page will head up Alphabet with fellow founder Sergey Brin becoming president.

Current Google chairman, Eric Schmidt, will be executive chairman of the holding company.

Rising start Sundar Pichai is appointed chief executive of the “newer slimmed down Google”.

Alphabet Inc. will replace Google Inc. as the publicly-traded entity and all shares of Google will automatically convert into the same number of shares of Alphabet. Google will become a wholly-owned subsidiary of Alphabet.
“The move was seen as a way of showing the company was now more than just a search engine. It has developed a wide range of businesses from self-driving cars, diabetes contact lenses, smart thermostats, drone delivery and, of course, the video network YouTube.However, there was some scepticism around the move away from the Google brand. Advertising through Google made up 89% of the company’s $66 billion revenue last year. There is concern that its tech-driven hierarchy have little affection for advertising as a basis for growth.

In a blog, Page said that the company had done a lot of things considered crazy which now have more than a billion users, such as Google Maps, YouTube, Chrome, and Android.

“And we haven’t stopped there. We are still trying to do things other people think are crazy but we are super excited about,” he said.

“We’ve long believed that over time companies tend to get comfortable doing the same thing, just making incremental changes. But in the technology industry, where revolutionary ideas drive the next big growth areas, you need to be a bit uncomfortable to stay relevant.

“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. I am really excited to be running Alphabet as CEO with help from my capable partner, Sergey, as President.”

Alphabet will be a collection of companies, the largest of which is Google.

“This newer Google is a bit slimmed down,” said Page, “with the companies that are pretty far afield of our main internet products contained in Alphabet instead. What do we mean by far afield? Good examples are our health efforts: Life Sciences (that works on the glucose-sensing contact lens), and Calico (focused on longevity). Fundamentally, we believe this allows us more management scale, as we can run things independently that aren’t very related.

“Alphabet is about businesses prospering through strong leaders and independence. In general, our model is to have a strong CEO who runs each business, with Sergey and me in service to them as needed. We will rigorously handle capital allocation and work to make sure each business is executing well.”

Page said he and Brin had been “super excited” about the progress of Sundar Pichai.

“It is clear to us and our board that it is time for Sundar to be CEO of Google. I feel very fortunate to have someone as talented as he is to run the slightly slimmed down Google and this frees up time for me to continue to scale our aspirations.

“I have been spending quite a bit of time with Sundar, helping him and the company in any way I can, and I will of course continue to do that. Google itself is also making all sorts of new products, and I know Sundar will always be focused on innovation—continuing to stretch boundaries. I know he deeply cares that we can continue to make big strides on our core mission to organize the world’s information.

“Sergey and I are seriously in the business of starting new things. Alphabet will also include our X lab, which incubates new efforts like Wing, our drone delivery effort. We are also stoked about growing our investment arms, Ventures and Capital, as part of this new structure.”

 

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