The US Internet giant Google divides itself on, structured around – and reinvents itself: In the future, a new publicly listed investment company called alphabet as an umbrella for the various Google affiliates is used, Google itself is only one, albeit the largest of its various brands as a new, leaner company.
At the same occurs co-founder Larry Page back as CEO of Google, and will lead the new CEO of Alphabet the fortunes of the investment company. CEO of Alphabet is Google co-founder Sergey Brin, who is responsible as CTO for all technical aspects and Innovation Management at Google so far. New head of Google is the Indian Sundar Pichai, previously responsible for all of Google’s end-user products such as Android and Chrome.
Under the new web presence of alphabet that is abc.xyz under the appropriate URL to find said Larry Page in a blog post under the Title “G as Google” the motives for the conversion:. “We believe for a long time that the company in the long term tend to be easy to always do the same, and only venturing small changes, but in the tech industry, where revolutionary ideas drive the future growth opportunities, have to make a little uncomfortable to remain relevant to it. ”
What in the Google brand remains
Google was operating currently very successful, but they wanted the successful products clear of the “Moon Shots” baptized experimental projects and the start-up investments separate. “This allows us fundamentally more management space as we can the things that do not belong together independent driving.”
Specifically, this means for the new alphabet: Under the brand name Google will in future only nor the successful Internet services and offers are summarized. In addition to the search engine and advertising network and services and apps like Mail and Drive, Google Maps and the mobile operating system Android, as well as the browser-Chrome Part of Google’s core unit, which will in future be managed directly by Sundar Pichai stay.
Noteworthy: Even YouTube that were previously under the direction of Susan Wojcicki perhaps most independent Google subsidiary, remains in the Google Group unit probably because so revenue from joint advertising network just stay attributable.
Centre will in future six projects
As an independent corporate subsidiaries of the new Alphabet Holding stand next Google on an equal footing in future six projects, purchases and spin-offs, which have little in common with the online offerings of the Group: The early 2014 purchased Internet-of-Things-start-up Nest, meanwhile, brand names, the Group sells home control devices such as a smart thermostat or home security cameras. Guided by the nest-founder and hardware expert Tony Fadell.
The biotech firm Calico, looking for drugs and therapies against aging on behalf of Google founders , Guided by biotech Manager Arthur D. Levinson. The telecommunications provider Fiber, the current in various US cities fiber optic cable for faster Internet connections routed, and operate in the future under the umbrella of the Group, the mobile brand Project could Fi. Chef and future CEO is the Australian network expert Craig Barratt.
Life Sciences, a health-tech manufacturer, one among others, currently smart contact lenses for diabetics and Spoon developed for Parkinson’s patients. To date part of Google X.
The incubator Google X, in which the Group’s craziest Moonshot projects such as solar-powered internet drones, but also the self- propelled Google car developed. Previously led by Sergey Brin.
Google Ventures and Google Capital, the start-up investment and private equity firms under the corporate umbrella, led by the venture capital Expert Bill Maris and David Lawee.
Exactly how and when the restructuring of the Group will be implemented, will reveal in detail in the coming weeks Google. It is already known that the company is traded on the stock exchange in the future under the name Alphabet, although the trading symbol on the trading floor persists the familiar GOOG.
alphabet is first established as a Google subsidiary, then you will be assigned to all of Google’s shares, while the Google shareholders at a ratio one to one new alphabet Shares received. Finally alphabet individually operate Google and the other parts of the group as new subsidiaries in which the new holding company holds 100 per cent. Technical details are in the formal market Communication with the supervisory authority SEC.
share price shoots up
The management will already be formally changed to that time: New Total CEO is Larry Page, as the new CEO Alphabet (“President”) is Sergey Brin, as in the past primarily responsible for the daughters besides Google.
Chairman of Alphabet remains Google veteran Eric Schmidt, the same task so far Google had. CFO both the new, leaner Google and alphabet remain Ruth Porat.
Sundar Pichai, already been largely responsible as Google Product Manager for the operative business of the Group, gets a new Google CEO now officially the title of he has worked for so long. “I am very happy that we have someone as talented as him, who heads the new, leaner Google. This creates me more time to achieve our future goals,” Larry Page writes about Pichais new role.
How long Larry Page and his team are already working on the reconstruction reveals Page not in his blog entry. But the alphabet URL was registered according abc.xyz Whois information already on 20 March 2014, the plans for reorganization of the Group for about eighteen months cherish the Google founders apparently so already.
structure similar to that of Buffets companies
While experts still pondered after the surprising announcement that restructuring to I mean, the stock market delivered a quick verdict: The price shot after publication in after-hours trading to over six percent up.
In 2014, Google’s share was first shown in the stock market weakness and are away from their former all-time high. But since the beginning of the year the share price had risen by around 25 percent. Above all, the most recent quarterly figures had driven the stock up.
The new structure accommodates investors. Alphabet will continue to publish more details on the economic success of the individual sub-segments in its quarterly reports apparently. The Google’s core business is therefore its figures from the fourth quarter of the current fiscal year separately from the investment and provide the research segment of the Group.
The Wall Street had demanded for a long time. She attended the highly profitable group could be considered by the future projects and “Moon Shots” of the Google founders downwards. The new structure is roughly equivalent to that of Berkshire Hathaway, the conglomerate of successful Star investor Warren Buffett. Its consolidated holding a bunch of different companies and investments under one roof.
More freedom for Page and Brin
The reorganization, however, is not just for investors beneficial. They are also Page and Brin more clearance. Risky investments they might outsource the future in their own companies outside of alphabet. Investors could make targeted acquire holdings in Google’s subsidiaries and projects in whose success they believe.
Even within the group of the competition could be structured in the future more clearly to capital and research funds, previously jointly projected costs would clearly assigned to the individual subsidiaries. “We will handle the capital allocation rigorously”, Page describes its future management style for the Alphabet daughters. Each subsidiary will get a separate CEO – and their payment can now be negotiated outside the Google content structure.
Whether the new structure also tax optimization could serve debatable expert in blog articles and comments in social networks already out loud.
advantages in competition cases?
Also in the various competition cases, which Google currently is facing in the EU and in the US , the new structure could bring advantages in the new holding structure about Google’s Internet services from the ISP Fiber would formally separated – in the United States of Google’s opponents already expressed criticism of vertical integration of network access and services would not be in the future more easy to maintain.
But several analysts see the alphabet project primarily as an opportunity for Google to maintain a lean and therefore effective management culture and to remain innovative. In addition, the Group hedges the clear separation against future potential losses in value previously dominant search advertising and business.
In a first analysis of the US economist and management expert Tyler Cowen dares therefore a cautious positive outlook – especially the competition of subsidiaries with each other going to the capital new create value, he writes the blog “Marginal Revolution”, only to immediately restrict again: “So far, the effects of conglomerates are underexplored.”
Larry Page even allowed himself behind the efforts of reconstruction already hidden first jokes about the new alphabet Society, and a hidden “Easter Egg” in its announcement : At a certain point in the text the satire side of the fake company Hooli XYZ is linked – there make the creators of the HBO cable TV show “Silicon Valley” on Google’s Moon Shots funny.
Meanwhile, also makes the network first jokes with the new URL: Who abc.wtf (“What the f …”) calls, ends up with Microsoft’s contention Search Engine Bing.
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