Google Now Spelt A-L-P-H-A-B-E-T

It took just one small announcement on Monday to shake up the tech world, and it came after the stock market had closed.

Google announced it’s new parent company, Alphabet. Along with the new name, some of Google’s businesses are splitting off to become their own separate companies under Alphabet.

Google, as we know it on the web, will remain Google, with that company powering the well-known Search, Maps, Advertising, Apps, Android, and YouTube. However, the company’s more news-grabbing ventures are all separating from the Google brand to somewhat stand on their own. That includes Calico, Nest, Fiber, Ventures and Capital, and X-Lab. Even the self-driving cars often generating excitement in the Bay area will fall in this plan as something separate from Google.

Google

Under the new structure, CEO Larry Page will run Alphabet along with Sergey Brin, who co-founded the web search business with him in 1998.

“For Sergey and me this is a very exciting new chapter in the life of Google — the birth of Alphabet,” Page wrote in a blog post on Monday. “We liked the name Alphabet because it means a collection of letters that represent language, one of humanity’s most important innovations, and is the core of how we index with Google search.”

So why the shake-up?

It all comes down to being able to invest and find investors in their moonshot tech ventures. By separating the day-to-day Google business from those items, investors or advertisers that are scared now have less to worry about. And those ventures that are turning dreams into reality, can now stand on their own two feet and find investors without stockholders or executives worrying about how that impacts the Google side of the business.

With an announcement that felt as if it came out of nowhere, it was definitely a confusing and stock-impacting (positive) announcement. However, when you actually break it down it makes sense for the well known tech power Google Alphabet, allowing it to continue to take steps in innovating the world.

Sources: New York Times, Google Investor Relations

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