What the Google Restructure Actually Means
It always comes as a shock when we’re introduced to new parents, but Larry Page and Sergey Brin’s announcement of Alphabet, Google’s new parent company, came a little out of the blue. Everyone is talking about it, and there’s a lot to talk about, so here are the key things you need to know about who now owns Google, and what changes are actually happening.
So, what is Alphabet?
To put it simply, Alphabet is a new holding company for Google, headed up by former Google CEO Larry Page, and former Google President Sergey Brin.
Essentially Alphabet is an umbrella company, covering and controlling a collection of companies. First and foremost is Google, the search and advertising behemoth, which in turn owns Maps, YouTube, and Android. Newly separate from Google’s core activities are companies such as Nest, Fiber, Google X, and Google Ventures.
Why has Google suddenly changed?
According to Google this change has come about because Google has moved on exponentially since it first started out, with Larry Page saying ‘from the start, we’ve always strived to do more’.
Google has always wanted to have a range of projects in different industries that weren’t necessarily synonymous with their core search engine and advertising services.
The sudden change in company structure comes with a range of benefits for Google and its various services. The slimming down means that Google’s different industry endeavours will become separate companies, each with their own CEO and structure.
Management will have more freedom in their companies progression, its branding, and much more – giving the companies a clearer focus. The move is also designed to help limit management churn; Google has been the victim of some high-profile poaching as of late, most recently with Maps CEO Brian McLendon heading over to Uber.
Google will now officially be a subsidiary of Alphabet.
How will it be organised now?
The restructure is massive, and while restructures of this kind are commonplace in business, in the tech industry, a re-jig this size is a massive deal. If you’ve been following the story of Alphabet’s announcement and are still scratching your head about the ownership structure, this chart visualises how the new holding company relates to its new subsidiaries.
The main division of Google will remain the same, and look after things like Android, YouTube, Maps and more. Google X will now be looking after life sciences developments such as Google’s driverless cars, Google Glass and more, with Calico heading up the health research side of things.
Google Ventures will be leading into venture capital, with Google Capital acting as the investment unit. Nest, the connected-home service, will also be reporting to Alphabet, along with Fiber, the fast internet service and newcomer Sidewalk, which will be a brand new urban technology project.
For investors, Alphabet will now replace Google Inc. as the public trading entity, and anyone with shares in Google will have them transferred onto Alphabet.
The restructure is on a massive scale, and with this comes a new sense of independence for each company. Now, if a venture of Alphabets fails miserably and dies, it’ll have no real effect on Alphabet as a whole, it’ll just be a mere blip that one of it’s companies encountered, and not harm the Alphabet brand (and hopefully helping to avoid another Google Glass fiasco).
How will it effect users?
Lets face it; this is the main thing we’re all thinking. It’s very nice that Google has had a complete restructure and all, but will this affect my Chrome browser? Will my Maps change? What about Android?
At the user-end, nothing will appear to have changed. The Google that consumers know (and love) will stay exactly the same and progress at it’s normal rate of updates, (yay!).
And now for some fun bits…
If you’ve had a keen eye, you’ll have noticed a hidden Easter egg in the announcement.
On a closer inspection one full stop in the text is actually a hyperlink to Hooli.xyz. A sly nod to the HBO show Silicon Valley, and it’s fictional Google company Hooli. Proving that although it’ll now be Alphabet, Google still has its cracking sense of humour.
For true fans and techies, there’s added humour in the Easter egg too, as the link actually violates Google’s own rules regarding hidden links.
Ahh Google, you crack us up.
Personally, we’re quite excited to see what Alphabet will bring, and with companies now having stricter outlines and purposes we feel this can only lead to good things. With Larry and Sergey at the helm, we’re pretty sure they’ll steer this new company right.
If you have any opinions on the new restructure give us a tweet, we’d love to know what you think about Alphabet.