Thursday, August 13, 2015

Google to Alphabet

Google, an internet giant decided to reform its structure as a company.

The Guardian: Google to restructure into new holding company called Alphabet

A new holding company, named "Alphabet," will keep the majority of the stock of Google and relevant subsidiary companies. Larry Page will become Alphabet’s CEO, Sergey Brin will be its president, and Eric Schmidt will be the executive chairman of Alphabet.

The new Google will be specialized to the internet service. Other projects, such as developing Google car and medical devices will be divided into each subsidiary company. "Alphabet" means a gathering of projects, reflecting the fact that Google has many contributions to several regions.

This scheme looks like Berkshire Hathaway, one of the biggest hold companies in the US. This restructure is expected to hasten the development of each project previously administered by Google.

The week: Google's Alphabet gamble: three reasons for the new structure

The market seems to accept the decision of Google positively. The stock price of Google was raised after the announcement.

However, the present reform is not entirely innovative. Considering the fact that gigantic companies are suffering from the dilemma of innovation, dividing whole organization into several independent divisions is a method that is often adopted.

Marketing Magazine: Google to Alphabet: smart move but not radical at all

I think Alphabet will become a typical conglomerate. And, Google will contribute to maintenance and improvement of current services rather than make a change in the whole industry. It is likely that innovations will be raised by other ventures in the future.

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