ALPHABET .. The Invention Of Alphabet Is The Ultimate Larry Page Move
Once
you get your head around it, Google's mind-bender of an announcement makes
perfect sense.
When
a coworker shared the news that Google was creating a new holding
company called Alphabet and splitting off all its non-core activities from the
Google brand, I
reacted in the only rational way: I wondered for a nanosecond if it was a
wonderfully wacky hoax. Then I checked the URL on Larry Page's blog post, in which he explained the
rationale and announced that longtime Googler Sundar Pichai would become
Google's CEO. It seemed to be legit.
And
then it didn't take long at all before the news began to sound less like
fantasy and more like exactly the sort of thing Larry Page would do.
It
has long been obvious that what got Page excited wasn't sitting in meetings
about incremental improvements to Google search, Gmail, or YouTube. Page, who
cofounded Google with Sergey Brin in 1998, wants to boil new oceans, such as transportation, connectivity, and life itself. Many a doubter has asked
how such efforts relate to Google's mission and primary operations in their
classical form. Now Page—if he ever grants another interview—can reasonably
respond: "They don't!"
It's
in Google's nature to do deeply idiosyncratic things that sound at first blush
like they might be a prank.
Anyone
who's been paying attention also knows that Page has been grooming Pichai to be Google's CEO. Creating Alphabet allows
Page to give Pichai the job without pulling himself away from the parts of
Google he's passionate about. And other hotshot executives—ones currently at
Google, or yet to be hired—will presumably like Page's statement that
Alphabet's big businesses will be run by their own CEOs, without much
interference from Larry or Sergey.
Page
could have pulled off much of this without introducing a new corporate moniker
or turning Google into (my fingers still have trouble typing these words) a
wholly owned subsidiary. But as he reminded us in his blog post, Google went
public in 2004 with the declaration, "Google is not a conventional
company. We do not intend to become one." It's in the company's nature to
do deeply idiosyncratic things that sound at first blush like they might be a
prank or a mistake.
In
2013, I interviewed Page for a Time magazine cover
story.
In one snippet of our conversation that didn't wind up in the article, he said
he spent a lot of time making Google products and services work well together,
and that in some ways it was easier to oversee disparate enterprises than ones
that were closely related. Page told me:
You
don’t want to have 25 different ways to share something or 18 different ways to
have a photo of yourself, things like that. There’s some integration to do,
which is difficult work. Making them work well and allowing us to innovate . .
. that’s a conversation that can’t have infinite scale. I spend a lot of time
doing that, my team spends a lot of time on that.
On
the other hand, I think there’s things we do that don’t require a lot of
integration currently. Project Loon [Google’s project to deliver broadband by
balloon] doesn’t require a lot of integration right now. The key thing is to
have the right mix of projects, and to think about, "Maybe I can take on
more projects."
It’s
kind of counterintuitive, but maybe you can actually do more projects that are
less related to each other. Normally in a business, you think about,
"What’s the adjacent thing that I can do?" because that’s where you
must have experts.
According
to Business Insider's Jillian D'Onfro, Page has been contemplating the move he announced
today for years,
which means that it isn't surprising that what he was saying almost two years
ago is perfectly in sync with the corporate restructuring announced today.
How
much effect will the invention of Alphabet have on Google's businesses? It's
too early to say, and it's possible that the bottom line will be subtle rather
than epoch shifting. For one thing, Page has never acted like he felt that
Google was pigeonholed by the prior arrangement. (If there are projects that
he's dolefully rejected for being too grandiose or insufficiently related to
the organization of information, I'd love to know what they were.)
Page
will still run a publicly traded company involved in a dizzying array of
activities.
In
the age of Alphabet, Page will still run a publicly traded company involved in
a dizzying array of activities—many of which, though admirably audacious, don't
make money and may or may not ever amount to anything. Page will still face
skepticism from investors and others who think that he is running an outfit
that is trying to do too much and isn't appropriately focused on the cash cow
at its core. Adversaries ranging from persnickety government agencies to other tech behemoths will be no more likely to
give Page's company the benefit of the doubt. It's just that this company won't
be called Google.
I
don't expect human beings not employed by Google to divide up Google and
Alphabet's operations into neat mental buckets. The Google brand is among the
most resonant ones on the planet, and Page says that Alphabet won't even be
a consumer brand. A few years from now, people will surely be talking about
"Google's self-driving cars," even if they theoretically have nothing
to do with Google.
And
when Larry Page does the kind of things that Larry Page does, nobody's going to
describe his behavior as "Alphabet-y." Whatever the name of the
company he runs, he will continue to define what it means to be Google-y.
By Harry McCracken
http://www.fastcompany.com/3049693/the-invention-of-alphabet-is-the-ultimate-larry-page-move?utm_source=mailchimp&utm_medium=email&utm_campaign=fast-company-daily-newsletter&position=1&partner=newsletter&campaign_date=08112015
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