Google has announced it is transforming into Alphabet, a holding company to house the collection of the companies it has acquired and is running, although Google will remain to be the biggest in the group.
The new company will comprise a whole spectrum of businesses - some of which are related to what Google already does - and others that are separate from the day-to-day themes of technology.
However, it won't be a consumer brand and won't launch any products or services - the individual companies within the holding group will develop them.
"Alphabet is about businesses prospering through strong leaders and independence," Larry Page, Google's CEO said. "In general, our model is to have a strong CEO who runs each business, with Sergey and me in service to them as needed."
He explained the two founders will handle capital allocation and work to make sure each business is performing, and their responsibilities will also include deciding how much each CEO earns.
Google will be headed up by Sundar Pinchai, who was rumoured to be taking over the top role at the company as early as last year, and will continue to focus on innovation and "stretching boundaries."
"In addition, with this new structure we plan to implement segment reporting for our Q4 results, where Google financials will be provided separately than those for the rest of Alphabet businesses as a whole," Page continued.
Although Alphabet will become Google's publicly-traded company and Google will become a wholly-owned subsidiary of Alphabet, its two classes of shares will continue to trade on the Nasdaq stock exchange as GOOGL and GOOG.
"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!" Page finished.
Image credit: Trey Ratcliff, Flickr
