Google is undergoing the largest reconstruction effort since the start of the company, with a new holding company and conglomerate similar to Berkshire Hathaway, News Corporation or General Electric named Alphabet becoming the main hub of control.
This demotes Google to a large subsidiary inside Alphabet, similar to other subsidiaries like Nest Labs, Calico, Google Ventures and Google Fiber. In the announcement letter, CEO of Alphabet Larry Page said each subsidiary would have its own CEO.
Google’s CEO is Sundar Pichai, who previously did most of the legwork for Page on software and services. Pichai is one in a growing list of Indian executives leading technology companies, with Satya Nadella (Microsoft), Shantanu Narayen (Adobe) and Rajeev Suri (Nokia) all taking the top spot in their company.
Nest Labs will continue to run independent of Google, with Tony Fadell as the leader. Astro Teller will remain leader of Google X and Bill Maris will retain his position as Google Ventures. Google Capital, the other long-term venture capital fund, will be headed up by David Lawee.
Craig Barratt, the head of Access and Energy at Google, will become the head of Google Fiber.
In the science side of Alphabet, Arthur D. Levinson will stay as CEO of Calico. Sidewalk Labs, focused on urban innovation, will be lead by Dan Doctoroff.
Google has its own umbrella and will continue to hold Maps, Android, Ads, Search and YouTube. Susan Wojcicki will retain her position as CEO of YouTube, despite being underneath Sundar Pichai.
The move to keep YouTube and Android connected inside Google is worrying. Having them separate would have spared Google the European Union investigation for anti-trust. Perhaps in the future we will see break offs, to offer more independence to the services.
Google learned its lesson on forced integration, with the failure of Google+. It has since removed Google+ as a necessity on YouTube. Hopefully, under Sundar Pichai, we will see more independence between these two services.
There are still a few divisions which haven’t been mentioned. DeepMind Technologies, currently developing deep learning techniques for computers, might be pushed under Google or remain an independent division. Google’s robotics division appears to be outside of Google X, in charge of prototype, but Google has not confirmed if that is a separate entity.
Google X should be the breeding ground of a lot of new subsidiaries at Google. With the self-driving car, Google Glass and Project Loon all coming to the public in the next year.
Google Glass may be classified under Nest Labs, which will become the hardware division for all of Google’s products. Project Loon will most likely go under Google Fiber, which will become Google’s internet infrastructure division.
Any new acquisitions that topple the current vision at Google may be pushed into an independent section, similar to Facebook’s handling of WhatsApp, Instagram and Oculus.
Alphabet is essentially the same executives that ran Google. Larry Page is CEO, Sergey Brin is president, Eric Schmidt is executive chairman and Ruth Porat is chief financial officer. The leaders of the various divisions will report directly to Page.
This should make it easier for Alphabet to acquire companies and also open up new divisions, without being labelled as anti-competitive. Hopefully, with the independence of various sectors, we will not see heavy handed tactics from the company to force content creators and companies to comply.