Google Just Made the Biggest Change in the Company's History

Aug 10, 2015

Google's leaders are turning the company into a subsidiary of a new "collection of companies" called "Alphabet," Google co-founder Larry Page announced in a Monday afternoon blog post that shocked the technology community.

Page will run Alphabet as CEO, with fellow Google co-founder Sergey Brin serving as president. Sundar Pichai, formerly Google's vice president in charge of products, will serve as CEO of Google.

The new arrangement will see Alphabet, Inc. replacing Google as the publicly-traded company, Page said. Current shares of Google will be transferred automatically into shares of Alphabet; the company will remain listed as GOOG on the NASDAQ.

Read more Read TIME's 2013 cover story, 'Google vs. Death'

Here's Page with more details on what Alphabet actually is:

What is Alphabet? Alphabet is mostly a collection of companies. The largest of which, of course, is Google. This newer Google is a bit slimmed down, with the companies that are pretty far afield of our main Internet products contained in Alphabet instead. What do we mean by far afield? Good examples are our health efforts: Life Sciences (that works on the glucose-sensing contact lens), and Calico (focused on longevity). Fundamentally, we believe this allows us more management scale, as we can run things independently that aren’t very related. Alphabet is about businesses prospering through strong leaders and independence.

In general, our model is to have a strong CEO who runs each business, with Sergey and me in service to them as needed. We will rigorously handle capital allocation and work to make sure each business is executing well. We'll also make sure we have a great CEO for each business, and we’ll determine their compensation. 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.

The 10 Most Ambitious Google Projects

A driver drives a Google Inc. self-driving car in front of the company's headquarters in Mountain View, California on September 27, 2013.
Google Driverless Car The Google Self-Driving Car has been in the works since 2005 after a team of engineers won a grant from the U.S. Department of Defense to design an autonomous car. The project, which aims to reduce traffic accidents, has made headway in recent years as states passed laws permitting self-driving cars. Google plans a commercial release between 2017 and 2020.David Paul Morris—Bloomberg/Getty Images
A driver drives a Google Inc. self-driving car in front of the company's headquarters in Mountain View, California on September 27, 2013.
Google Internet Balloon
This undated photo released by Google shows a contact lens Google is testing to explore tear glucose.
Avatars from Google Lively.
Eye in the Sky
Google's modular phone (Project Ara) at Engadget Expand New York 2014 at Javits Center on Nov. 7, 2014 in New York City.
colored pill capsules
Flight team engineers Kenneth Jensen, left, Damon Vander Lind, center, and Matthew Peddie prepare for the first crosswind test of their 20kW Wing 7 airborne wind turbine prototype in Alameda, Calif. on May 24, 2011
Vic Gundotra, director of product management of Google, demonstrates Google+ on the Nexus 7 tablet during Google I/O 2012 at Moscone Center in San Francisco on June 27, 2012.
Books
Google Driverless Car The Google Self-Driving Car has been in the works since 2005 after a team of engineers won a grant
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David Paul Morris—Bloomberg/Getty Images
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