Google Reorganizes Into New ‘Alphabet’ Company

Google Reorganizes Into New ‘Alphabet’ Company

You’ve probably heard that Google now owns the alphabet. Well, not quite, but the company on Monday announced that it has restructured, and created a new parent company, “Alphabet,” which will include Google as one of several subsidiaries.



The new incarnation of Google will be “slimmed down,” and see key executive Sundar Pichai promoted to the position of CEO, according to Google co-founder Larry Page, now in charge of Alphabet. Pichai has “really stepped up” since taking on new product and engineering responsibilities in October, Page said in a blog post, adding that the executive “has been saying the things I would have said (and sometimes better!) for quite some time now.”

While products such as Search, Maps, Android, YouTube and advertising will remain under Google’s domain, businesses that weren’t part of Google’s core Internet offerings will move under the Alphabet realm.

Alphabet will be the parent of companies such as Nest, Fiber, the Google X research labs, Calico, and Google’s Ventures and Capital investment firms.

Why Alphabet? “We liked the name Alphabet because it means a collection of letters that represent language, one of humanity’s most important innovations, and is the core of how we index with Google search,” Page wrote in a blog post. “We also like that it means alpha-bet (Alpha is investment return above benchmark), which we strive for! I should add that we are not intending for this to be a big consumer brand with related products–the whole point is that Alphabet companies should have independence and develop their own brands.”

As far as investors are concerned, all existing Google shares will automatically convert into the same number of shares of Alphabet stock. Beginning in the fourth quarter, Google results will be separate from the rest of Alphabet.