Google is restructuring. The search giant will now be part of several companies under a new holding company called Alphabet Inc that has been formed as focus turns to the future of technology and the connected world. Google has as a business acquired a lot of startups and other companies that are working on lots of different amazing things and some things that we never get to hear about. Like the project to beam the internet to those in remote areas using balloons. Or the ambitious plan to look into ways to prolong human life. Or the arm that invests in startups like Uber.
Alphabet will not only be the holding company of Google, the company’s main internet business and poster child but also others that deal with everything from drones (Titan Aerospace and Wing) to robotics (Boston Dynamics) to connected home appliances (Nest) to healthy living (Life Sciences) to advances in the field of Artificial Intelligence (Deep Mind) and many other things. There’s Makani for instance: a company that employs the use of giant kites to harvest wind power. Then there’s the famous X Labs, the home of every imaginable crazy moonshot the world has seen. There’s also the company that seeks to prolong the lives of human beings by doing away with things like aging and eventually death, Calico (California Life Company). Google’s investment arms Ventures and Capital are also affected by the restructuring. All these will now be under Alphabet with Google itself being “slimmed up” so as to focus on its key products.
While we may not have seen it then, the decision to have Sundar Pichai oversee more products last year was the biggest indication of what was to come for Google’s new Chief Executive Office. Also the fact that he was the senior most Google executive at I/O 2015 spoke so much of the trust the company’s who is who had placed in him. As Larry Page writes in the blog post announcing Alphabet’s existence, he’s mostly earned that trust and confidence. He’s now overseeing the entirety of Google’s product lineup as the CEO. Page and co-founder Sergey Brin now head the new outfit with Page being the CEO while Mr Brin is the President. Eric Schimidt, who until the announcement was the executive chairman of Google, becomes the new holding company’s executive chairman.
YouTube will continue operating as a product of Google as will other notable Google products like Gmail, Search, Chrome and Android.
In essence, every one of these companies under Alphabet operate independently and are only overseen by the holding company. They can take whatever risks necessary to pursue their endeavours without bringing any harm to the rest. For instance, a loss making venture like Motorola was before being sold off to Lenovo for instance would previously dent Google’s books. Under the new arrangement, that will no longer be the case.
Alphabet is not just the name of a new holding company that is responsible for some of the most widely used technologies on the planet. It is an indicator of the ambitions of Google’s founders. There’s to be an Alphabet company in every letter of the English alphabet as we know it today. Where that isn’t the case at the moment then there’s a byproduct of one of the companies that fills the void and that is also bound to change as more products that have been in the pipeline for quite some time like those autonomous cars finally begin to take shape going forward.
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! 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.