Alphabet Gives Google's Tech Ventures Best Venue to Succeed or Fail
NEWS ANALYSIS: The creation of the holding company Alphabet was intended in the short term to make Google's business more attractive to investors, but there's more to it than that.As you can tell from my colleague Chris Preimesberger's analysis article, Google's rationale for creating the Alphabet holding company included providing greater transparency for investors. Google, after all, has been taking an eclectic approach to technology research and development, from creating the world's top search engine to testing driverless cars. It's pretty clear that investors like Google's decision to create Alphabet because Google's stock jumped nearly $40 a share after Wall Street heard about the move. And as important as it is to keep investors in mind when you're a public company, the fact is that the move by Google to create a holding company has significant implications further down the road. In fact, by making this change, Alphabet can go a long way toward driving technology development in a variety of areas, and the company that used to be Google can be a leader in a whole new range of technologies.
When you take a look at how Google has been organized (or perhaps a better word is disorganized), you'll see a bunch of business ventures lumped together. Google was composed of a mega-search-engine company that has been busy accumulating all of the information that exists. But there's so much more.