Google is now part of a larger collection of companies that’s named Alphabet. The new CEO of Google is Sundar Pichai. The CEO of Alphabet is Google’s former CEO Larry Page, and Sergey Brin will serve as the president. Head spinning? Mine too.

“We’ve long believed that over time companies tend to get comfortable doing the same thing, just making incremental changes,” Page said of the news. “But in the technology industry, where revolutionary ideas drive the next big growth areas, you need to be a bit uncomfortable to stay relevant.” Uncomfortable indeed, and I don’t think anyone really saw this coming.

Page explained that the new firm, Alphabet, is a “collection” of companies that includes 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,” Page said.

Here’s a longer explanation of what’s going on, also from 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. Alphabet is about businesses prospering through strong leaders and independence. In general, our model is to have a strong CEO who runs each business, with Sergey and me in service to them as needed. We will rigorously handle capital allocation and work to make sure each business is executing well. We’ll also make sure we have a great CEO for each business, and we’ll determine their compensation. In addition, with this new structure we plan to implement segment reporting for our Q4 results, where Google financials will be provided separately than those for the rest of Alphabet businesses as a whole.

Other “Google” initiatives still exist, but they aren’t part of Google anymore. The Project X lab, for example, is now part of Alphabet, which will also have “Capital” and “Ventures” businesses. Google’s ticker symbols on the Nasdaq will remain GOOG and GOOGL, but Alphabet Inc. will replace Google Inc. as the “publicly-traded entity and all shares of  Google will automatically convert into the same number of shares of Alphabet, with the same rights,” Page explained.

Strange day but there you have it. Google is now part of Alphabet.

SOURCE GOOGLE