Google announced a surprise overhaul of its operating structure on Monday, creating a holding company called Alphabet to pool its many subsidiaries and separate the core web advertising business from newer ventures like driverless cars.
As part of a major overhaul of its operating structure, co-founder Larry Page will step down as chief and India-born, IIT-Kharagpur alumnus Sundar Pichai was appointed as head of a “slimmed-down” version of the company.
The move appeared to be an attempt by the search engine giant to focus on its more creative and ambitious projects, while investors cheered the potential for more financial disclosures of its disparate business segments.
Google’s planned structure resembles the way companies like Berkshire Hathaway and General Electric are organised, with a central unit handling corporate-wide activities such as finance and relatively independent business units focused on specific areas. Under the new corporate structure, the Google unit — which will be headed by Pichai — will encompass the core search engine as well as Google Maps and YouTube.
Alphabet will replace Google as the publicly traded entity and all shares of Google will automatically convert into the same number of shares of Alphabet, with all the same rights.
Page will now head Alphabet, co-founder Brin will become president and Eric Schmidt, now chairman of Google, will be the executive chairman. The company’s current directors will become directors of Alphabet.
Pichai is just the third person to officially run the search company, besides Page and Schmidt.
Pichai, 43, owes his new job to his success in making Google products easier to use and thus more popular. He joined the company in 2004 and made a name for himself early as a product manager, working on high-profile efforts like Chrome, the company’s Web browser.
Chrome grew like a weed, exploding from a single-digit percentage of market share to become the most widely used browser across desktops and mobile devices in the world, according to StatCounter.
Two years ago, Page promoted Pichai to also oversee Android, the software that runs 78 per cent of the smartphones sold around the globe, after Andy Rubin stepped down.
Born in Tamil Nadu, Pichai spent his early years in the Chennai region.
Pichai came to the US and obtained a MS degree from Stanford University and an MBA from Wharton before working as an engineer at Applied Materials.
He also had a stint in management consulting giant McKinsey & Co. He joined Google after trying to talk to one of his McKinsey colleague out of going there, and then realising the arguments in favour of joining the company were better.
