What Does Google’s New Business Structure Mean?

Google will become a subsidiary of Alphabet, a new company that will encompass other ventures such as Calico, a business focused on longevity, X lab which will focus on technological innovations such as drone delivery or Life Sciences.

Larry Page, one of Google’s founders, announced that he will be the CEO of Alphabet, whilst Sergey Brin, the other co-founder will become the President of this new company. Google will be taken over by Sundar Pichai, the former Android and Chrome head, who has been heavily involved in the running of Google since October 2014 will be the new CEO.

But what does this new structure actually mean? According to Page, the reason behind this massive change is to make Google “cleaner and more accountable”. Thus, Google will be the main entity in charge of internet products and it will be separate from other “far afield” companies that explore other kinds of developments.

This new version of a slightly slimmed down Google will continue to focus on innovations such as the new apps Google Photos and Google Now under Pichai’s guidance, whilst Page and Brin will be able to oversee all of the businesses that will be incorporated under Alphabet. This means that the new structure should allow Google to “become even better through greater focus”.

Robert Williams, Managing Director at Williams Commerce, comments that “We’ve tried to understand Google’s strategy for some time. The formation of this new group company ‘Alphabet’ makes it clearer to understand where Google are going and how they differentiate between core Google business and new business areas.”