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By | Iain Thomson 10th August 2015 21:30

W is for WTF: Google CEO quits, new biz Alphabet takes over

Larry Page and Sergey Brin go full Tony Stark

+Comment Google CEO Larry Page has quit day-to-day management of the web giant, and made Sundar Pichai chief exec.

Page and fellow Google cofounder Sergey Brin, both multibillionaires, will head up a new company called Alphabet, which will wholly own Google.

"Sundar has been saying the things I would have said (and sometimes better!) for quite some time now, and I've been tremendously enjoying our work together," Page wrote in his retirement letter a blog post on Monday.

"He has really stepped up since October of last year, when he took on product and engineering responsibility for our internet businesses. Sergey and I have been super excited about his progress and dedication to the company. And it is clear to us and our board that it is time for Sundar to be CEO of Google."

Page will be CEO of Alphabet, and Brin its president. Alphabet will hold onto Google as a subsidiary. Google shares will be converted into equivalent stock holdings in Alphabet, with the same rights – or lack of them.

"We liked the name Alphabet because it means a collection of letters that represents language, one of humanity's most important innovations, and is the core of how we index with Google search!" said Page.

"We also like that it means alpha-bet (Alpha is investment return above benchmark), which we strive for! I should add that we are not intending for this to be a big consumer brand with related products – the whole point is that Alphabet companies should have independence and develop their own brands."

Alphabet will run Google's X Lab skunkworks, along with Google's prototype drone delivery service, bio-boffinry base Calico and other advanced projects, including presumably its self-driving cars and its robotics division. The Ventures and Capital arms will also come under Alphabet's direct control, as will Fiber, Life Sciences, and Nest.

Pichai will run Google's traditional search, advertising, video, browser, and operating system businesses – as he has effectively been doing for nearly a year now, anyway. Google will be slimmed down in other ways, Page said, without being precise.

"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," said Page.

"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."

Reg Comment

Details are still coming in, but here's El Reg's take. It looks like Page and Brin are bored of Google, and want to go full Tony Stark. So they've handed the day-to-day business dealings of their advertising empire to a safe pair of hands. Now they don't have to do all the boring stuff they hate: office meetings, company administrivia, and so on.

This lets the pair spend their time investing in all sorts of madcap ideas and startups, from transport and education to food and medicine, using Google's billions – but at an arm's length from Google. This unties Google, the corporation, from Page and Brin's adventures, and most likely makes the tax situation a lot easier for all the companies involved.

It's also particularly handy for Google at a time when the web goliath is facing antitrust probes and a few other legal challenges. Wouldn't want investigations into the dominant advertising business to interfere with Skynet Alphabet's precious investment bets, eh? ®

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