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Google Businesses

Google Is Restructuring Under a New Company Called Alphabet 235

Posted by samzenpus from the what's-in-a-name? dept.
Mark Wilson writes: Sundar Pichai is the new CEO of Google as the company undergoes a huge restructuring. Co-founders Larry Page and Sergey Brin are moving to a new company called Google Alphabet which will serve as an umbrella company for Google and its various projects. Google itself is being, in Page's words, "slimmed down" and the change is quite an extraordinary one. Page quotes the original founders' letter that was written 11 years go. It states that "Google is not a conventional company", and today's announcement makes that perfectly clear. There's a lot to take in...Google Alphabet is, essentially, the new face of Google. Page chose to make the announcement in a blog post that went live after the stock markets closed. This is more than just a rebranding, it is a complete shakeup, the scale of which is almost unprecedented.
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Google Is Restructuring Under a New Company Called Alphabet More

Google Is Restructuring Under a New Company Called Alphabet

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  • Seems like stockholders... (Score:5, Interesting)

    by garyisabusyguy ( 732330 ) on Monday August 10, 2015 @05:13PM (#50288527)

    may have been getting a little impatient with the many directions that Google was going in.

    This allows Google to focus on making money from advertisements, while Alphabet can makes bets on many different products

    At least that is my take on it

    • It probably also goes some distance to protecting Google's product development from any threats against its advertising business by cranking regulators.

      • Courts (Score:5, Insightful)

        by Etherwalk ( 681268 ) on Monday August 10, 2015 @08:29PM (#50290157)

        It probably also goes some distance to protecting Google's product development from any threats against its advertising business by cranking regulators.

        And courts. This helps to segment Google's advertising business so that if they get slammed by a government for refusing to censor, it's much harder to go after the parent company's assets. It's risk-management for shareholders.

        • Re:Courts (Score:5, Interesting)

          by Dahamma ( 304068 ) on Monday August 10, 2015 @10:27PM (#50290827)

          Except that the "Google" division - which contains search, apps, Android, and ads - is still nearly all of their revenue.

          Based on the divisions they spun off - Life Sciences, Calico (longevity project), Google X, Google Ventures - it seems like it's more of an effort to separate out the big profit center from the longer term projects that aren't directly generating revenue (ie. short term shareholder value).

          It's going to let them invest in these really interesting long term projects without shareholders bitching about the risk. Which is awesome, and really does show they are running the company differently than the usual tech behemoths. Just think if HP, IBM, Microsoft, etc had done this *properly* at their peaks (vs spinning off valuable businesses as entirely separate companies like HP did, or repeatedly shuffling the deck chairs like Microsoft keeps dong) - they might still be relevant.

          • It might grow into a Generic Electric conglomerate model though. Conglomerates seldom end well as it's easy to lose corporate focus.

          • Re: (Score:2)

            by gl4ss ( 559668 )

            why would it make shareholders bitch less when the same shareholders own this now as well?

            I know, I know, that's what larry is hoping for, but nothing is changing in regards to that - its still all stockholders money.

            all I see so far is that it shows how gullible google fanboys are that they think just rebranding them into a yet another branded X labs would actually change _anything_ about where the bills are paid from.

            the traded stock stays 100% the same as before - who pays for what doesn't change one bit

            • Re: (Score:3)

              by Dahamma ( 304068 )

              Same reason Warren Buffet manages to convince his shareholders to STFU. The more separate companies the harder it becomes to target one bad decision.

              Of course that means Google really needs to add "Google Term Life Insurance" subsitiatry. That way they can get the insurance float (like BRK.A) to actually fund their immortality projects so their life insurance never needs to pay off!

        • Re: (Score:2)

          by gl4ss ( 559668 )

          And courts. This helps to segment Google's advertising business so that if they get slammed by a government for refusing to censor, it's much harder to go after the parent company's assets. It's risk-management for shareholders.

          read the posting, then if you don't understand it try to make a diagram on a paper or something about the ownership/stock relations before and after this rebranding.

          no difference at all!. all you have is sundar as ceo of some part of it, while being in the organizational chart directly under larry and sergei! the friggin BOARD doesn't change, though presumably now they're the board of google alphabet! does larry bother to talk about that even? HECK NO! the only time board is mentioned is that "they" think

    • "Unconventional" (Score:4, Interesting)

      by Anonymous Coward on Monday August 10, 2015 @05:26PM (#50288687)

      Google is not a conventional company. It'll rob you in ways you've never imagine before, and will continue to rob you as it morph itself in ways you cannot even begin to imagine.

    • Maybe this change has just a simple purpose in enabling Google to avoid paying taxes . . . ? I mean, in which country will the "Google Letters, A-Z" be incorporated? Ireland? The Cayman Islands . . . ? Will one Google Alphabet subsidiary own other subsidiaries . . . ?

      Google could an opaque corporate structure, that would be undecipherable to tax authorities in different countries.

      • Already done. Google's been under government heat for some time about taxes precisely because they use all legal loopholes available to them. My first thought was that this makes it easier to spin off ancillary companies like Nest that don't contribute much to the core Google business. If they go ahead and reorganize every unit as its own "company," it will add a new layer of bureaucracy, but also more accountability to each new CEO to make their business profitable. It's possible this is as simple as the b

      • Re: (Score:2)

        by mjwx ( 966435 )

        Maybe this change has just a simple purpose in enabling Google to avoid paying taxes

        No, this is just the preceding steps before they release their new line of soups.

    • Google hired a new CFO. CFOs like to structure things. It's the most fun they get in a day. Thus he created a new corporate structure for Google, that looks exactly like the old structure but more formal.

      Also, who knew that Google invested venture capital in Blue Bottle coffee?

    • Re: (Score:2)

      by gl4ss ( 559668 )

      not really at all. the stock doesn't change. the guys who are responsible for what inside google doesn't actually change. it doesn't let anyone focus on whatever any more, it just lets them emphasize one profit number more than actual profit.

      THIS IS JUST A REBRANDING. nothing, nothing else. the position of the stock owners doesn't change one bit.

      it is just a rebranding and the addition that the "google" finances are reported quarterly separately. it's just a rebranding that makes the google numbers seem bet

  • Prepare Three Envelopes (Score:5, Funny)

    by Anonymous Coward on Monday August 10, 2015 @05:14PM (#50288535)

    A fellow had just been hired as the new CEO of a large high tech corporation. The CEO who was stepping down met with him privately and presented him with three numbered envelopes. "Open these if you run up against a problem you don't think you can solve," he said.

    Well, things went along pretty smoothly, but six months later, sales took a downturn and he was really catching a lot of heat. About at his wit's end, he remembered the envelopes. He went to his drawer and took out the first envelope. The message read, "Blame your predecessor."

    The new CEO called a press conference and tactfully laid the blame at the feet of the previous CEO. Satisfied with his comments, the press -- and Wall Street - responded positively, sales began to pick up and the problem was soon behind him.

    About a year later, the company was again experiencing a slight dip in sales, combined with serious product problems. Having learned from his previous experience, the CEO quickly opened the second envelope. The message read, "Reorganize." This he did, and the company quickly rebounded.

    After several consecutive profitable quarters, the company once again fell on difficult times. The CEO went to his office, closed the door and opened the third envelope.

    The message said, "Prepare three envelopes."

  • Whut (Score:2)

    by astro ( 20275 )

    This has got to be a joke somehow, right? I find this shocking.

    • Yes, Alphabet is becoming an Umbrella Corporation, this cannot end badly.

      • Re: (Score:2)

        by TWX ( 665546 )
        I predict a lot of whackers [urbandictionary.com] driving around in retired cop cars with fake badges and radios, with lightbars on top that are barely legal since they have no red or blue bulbs, with "Umbrella Corporation" painted on where "To Serve and Protect" would normally go, and with "REACT TEAM" and some sketchy homage to an official seal painted on the doors...

  • 25 more letters (Score:5, Funny)

    by billybob2001 ( 234675 ) on Monday August 10, 2015 @05:18PM (#50288615)

    Makes a change from everything they do being just Beta.

    • actually, this is actually just an actually very regressive change. they actually are just going to be sticking with Alpha and Beta software stages. That's why they're actually calling the new organization ALPHA-BET-a.

      if this doesn't work out the plan is actually to just rename it Spaghettios.

      captcha: actually

    • I believe that's just 23 letters [wikipedia.org].

      No, I'm not a pedant. I think "smarty-pants" is a more appropriate term.

  • In other words (Score:3)

    by DaMattster ( 977781 ) on Monday August 10, 2015 @05:20PM (#50288631)
    Google employees should be in fear of losing their jobs. Corporate speak .....

  • A couple points (Score:5, Informative)

    by 93 Escort Wagon ( 326346 ) on Monday August 10, 2015 @05:24PM (#50288669)

    First, the new parent company is just called "Alphabet" - not "Google Alphabet", as the summary claims.

    Second, on the face of it this seems more like a rebranding than anything else. Nothing seems to be changing; they're just renaming "Google" to "Alphabet", and then repurposing the Google name to be used for one already-existing division within the renamed company. It doesn't sound like anything functional is really changing, which belies the idea this is a "massive reorganization".

    • It was a stupid name anyway. Even when I was a fan I didn't like it. I for one welcome our new Alphabet-as-a-verb overlord.

  • Conversations will now go like this: (Score:4, Insightful)

    by wonkey_monkey ( 2592601 ) on Monday August 10, 2015 @05:27PM (#50288713) Homepage

    - So, there's this new Alphabet project-

    - You mean Google project?

    - Yeah. So anyway, this new project...

  • It's called a conglomerate (Score:5, Insightful)

    by Thelasko ( 1196535 ) on Monday August 10, 2015 @05:30PM (#50288739) Journal
    Google has been slowly changing from a dotcom tech company to a multinational conglomerate for a few years now. This is just them acknowledging that fact and structuring the company accordingly. This is similar to how United Aircraft became United Technologies [wikipedia.org] in the 70s.

  • Alphabet was their second choice (Score:4, Funny)

    by PopeRatzo ( 965947 ) on Monday August 10, 2015 @06:04PM (#50289045) Journal

    Apparently, someone already owns the rights to "Evil Corp".

  • Moving their eggs out of the same (legal) basket. (Score:2, Interesting)

    by Anonymous Coward

    Actually it would not surprise me if this were being done for legal protection. Google has diversified in so many different areas since its original creation, and many of these different areas have had their fair share of legal difficulties. Presently any legal attack on one of these areas is an attack on Google as a whole. By splitting the company into a bunch of separate legal entities, albeit under the same corporate umbrella, legal risk to the whole is mitigated.

    For instance, Google/Alphabet can roll th

    • This is pretty much it.The Founders want to work on true Information Age stuff, but being all under one flag was just drawing too much heat from the political waves this kind of change causes.

  • Alphabet...ically (Score:5, Informative)

    by U2xhc2hkb3QgU3Vja3M ( 4212163 ) on Monday August 10, 2015 @06:12PM (#50289101)
    Alphabet comes before Apple in a list sorted alphabetically.

    • Yet "Activision Blizzard" is before Alphabet, and Activision was named to be before Atari. The race to the front of the phone book continued with three other companies started by Activision alumni: Accolade (Populous; HardBall), Acclaim (home versions of Smash TV, Mortal Kombat, and NBA Jam, as well as numerous movie and TV licenses), and Absolute (A Boy and His Blob; Penn & Teller's Smoke and Mirrors).

    • Re: (Score:2, Funny)

      by Anonymous Coward

      But not in a list sorted Applebetically!

    • In other news another top Fortune 500 company, based in the caffeine capital of the world, decides to rename itself after a nocturnal African animal that looks like a cross between an anteater and a pig.

  • Comment removed based on user account deletion

  • Rewriting history (Score:5, Insightful)

    by 93 Escort Wagon ( 326346 ) on Monday August 10, 2015 @07:26PM (#50289667)

    I love how, in the blog post, Larry specifically mentions four things that "seemed crazy at the time" that purportedly began at Google. Unfortunately two of them - YouTube and Google Maps - were actually created by others and eventually purchased by Google.

    I can't wait for his future declarations regarding how people thought Google was crazy when they first created Waze!

  • Must be a typo, they're already known as Google Alwaysbeta
  • On the downside, this will make shuffling people and resources around between their different projects much more difficult, and likewise will make it harder for ideas to get heard that don't pertain to the current business division.
    • Do shuffled people really move that far and often from their core competency. Eg, moving from server farm optimization to driverless car navigation.

  • A promotion for Sundar Pichai, not much else (Score:5, Interesting)

    by dzoey ( 578558 ) <dzoey@acm.org> on Monday August 10, 2015 @08:46PM (#50290265)
    Before the announcement, Google was composed of many divisions (e.g. YoutTube, Calico etc.) each reporting to a person that reported to the Google CEO, except for Google itself. After the announcement, Alphabet is composed of many companies (Google, YouTube, Calico, etc) each with a CEO that reports to the Alphabet CEO who used to be the Google CEO. It creates a position at the top for a Google CEO that will be filled by Sundar Pichai, who clearly deserves the recognition. But, it doesn't look like much else changes. It's the same people doing the same work.

    The rumor on the Google blog is that Twitter was looking to offer Sundar Pichai a CEO position, so this move was made to keep him.

    Perhaps there are some additional legal protections gained by doing this reorg as well.

  • i guess someone in Munich is about to get rich(er)... maybe (geworden sein ab). "whois alphabet.com":
    Registrant Name: Domain Manager
    Registrant Organization: Bayerische Motoren Werke AG
    Registrant Street: Petuelring 130, Dept. AJ-35
    Registrant City: Munich
    Registrant Postal Code: 80788
    Registrant Country: DE

  • It's popular to explain why they created an umbrella company and offer your theories. But I am convinced of this: the general public is not aware of the reason at this time.

    I'll offer a very general reason they would do this, I don't have the details: doing this creates a financial/legal advantages for Larry Page and Sergey Brin. What kind of advantage? Why does it create the advantage? I don't know. But why do business people do anything?

    I could be wrong, but I don't think it is for the "soft" reasons

    • It's popular to explain why they created an umbrella company and offer your theories. But I am convinced of this: the general public is not aware of the reason at this time.

      I'll offer a very general reason they would do this, I don't have the details: doing this creates a financial/legal advantages for Larry Page and Sergey Brin. What kind of advantage? Why does it create the advantage? I don't know. But why do business people do anything?

      I could be wrong, but I don't think it is for the "soft" reasons that people are positing now, i.e. it explains the structure better, it highlights that Google is not a "conventional company". This is a big change, and probably an expensive and time-consuming one. And making everyone aware of this "Alphabet" brand is a big pain in the ass.

      I think the reasons they did this are very specific and concrete, but we just don't know what those reasons are at this point.

      There are a lot of reasons as to why this may be happening. It's very possible that it has to do with the fact that Google has had antitrust allegations levied against it in the EU (they were formally filed in April of this year). With separate subsidiaries it may make it easier to shield themselves from certain allegations in that anti-trust case, for instance. I suspect that we'll know within 12-18 months whether it was done for this reason. In any event, I think you are right that it was done for mon

  • Sooner or later, someone had to try to trademark or copyright the alphabet. :P

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