Sundar Pichai will serve as Google's next CEO

Aug 11, 2015 06:36 GMT  ·  By

In a shocking announcement on Monday night, Larry Page announced a restructuring of Google, splitting all its smaller ventures into separate businesses and organizing them under an umbrella company called Alphabet.

Larry Page will resign as Google CEO and will become Alphabet's new CEO, while Sergey Brin will serve as Alphabet's President.

Taking over from Page as Google's CEO will be Sundar Pichai, the company's former Product Chief, a position he held since October 2014.

"Sundar has been saying the things I would have said (and sometimes better!) for quite some time now, and I’ve been tremendously enjoying our work together," said Larry Page about the Mr. Pichai.

C is for Calico, G is for Google, N is for Nest

Alphabet, the new company in which Google will be just one of its cogs, will hold many of Google's former divisions. These are to be broken up, formed as separate financial entities, given a competent CEO, and put under Mr. Page's supervision.

Basically, it's just like it was in Google, only now they're reporting to Mr. Page as the Alphabet CEO.

The press release on Alphabet's website doesn't mention which divisions are to be broken into separate companies, but common sense dictates that Calico (research focused on life longevity), Life Sciences (medical products), Sidewalk Labs (urban planning), Google Fiber (Internet access), Google Nest (smart home products), Android (mobile OS), Google X (moonshot products), and Google Ventures (startup investments) will be branched out.

YouTube, Google Maps, Google Ads, Gmail, Chrome, and the rest of the company's Web-based products will remain under the main Google brand. There is also a rumor Android will not be spun out of Google and will remain with the parent company.

Google shares went up 6.2% after the news broke

As you can see, basically, all the main revenue sources will remain in the main Google branch, while all the dangerous and moonshot products will be moved out into their own company.

Regarding how this move will impact shareholders, Larry Page said, "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 all of the same rights."

"Google will become a wholly-owned subsidiary of Alphabet. Our two classes of shares will continue to trade on Nasdaq as GOOGL and GOOG," he added.

Hours after the news came out, Google shares soared 6.2%.