Page and Brin hand over management of search-giant's parent,
Alphabet, to Pinchai
By Rob Copeland
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (December 4, 2019).
Google co-founders Larry Page and Sergey Brin stepped down from
active management of the internet giant's parent, surrendering
immediate control to a low-key company veteran who must navigate
global regulatory threats as well as employee discontent.
Messrs. Page and Brin, who had been chief executive and
president, respectively, of Google parent Alphabet Inc., said
Tuesday they would hand control immediately to Sundar Pichai,
Google's existing CEO. They remain on Alphabet's board and will
still together control a majority of voting power over company
decisions under Alphabet's dual-class share structure.
Still, the move instantly cements Mr. Pichai, an India-born
immigrant and longtime Google executive, as one of Silicon Valley's
most powerful figures. His purview now extends beyond search,
advertising and related products like YouTube into Alphabet's
far-flung ventures, like driverless cars and high-altitude balloons
and efforts to prolong life.
Mr. Pichai, 47 years old, also must now take on a larger role in
addressing the many regulatory and political threats that swirl
around the company and much of the tech industry.
Messrs. Page and Brin founded Google as Stanford University
students working out of a garage in 1998, and built it from a
straightforward search engine into a global conglomerate that
controls how most of the world interacts with the internet. They
also created an often-restless and freewheeling corporate culture,
which became a model for some technology peers but of late has been
challenged to match prior growth and mired in internal political
debates.
Although still closely identified with the company, the
co-founders have been a dwindling visible presence inside the
Mountain View, Calif., campus for years, current and former
employees say. They haven't personally addressed employee
complaints, from across the political spectrum, that the company
culture has become conventionally corporate, and less open, than in
the past.
Nonetheless, their move to cede management responsibilities to
Mr. Pichai was unexpected.
Google faces an unusually fierce collection of threats this
year. Competitors like Amazon.com Inc. are chipping at its
online-advertising business, while state and federal regulators are
beginning broad investigations of purported anticompetitive
behavior. Google has pledged to cooperate with the inquiries.
"While it has been a tremendous privilege to be deeply involved
in the day-to-day management of the company for so long, we believe
it's time to assume the role of proud parents," Messrs. Page and
Brin wrote in the letter. "We plan to continue talking with Sundar
regularly, especially on topics we're passionate about."
Though their popular reputation is as a monolith, the pair has
at times disagreed about the direction of the company. Mr. Brin, 46
years old, has generally taken a libertarian, noninterventionist
approach to the flagship search results, while Mr. Page, also 46,
pushed for more "manual actions," or efforts to actively curate
results.
While still in their 20s, and with Google growing rapidly, they
brought in Silicon Valley veteran Eric Schmidt as CEO in 2001 for
what Mr. Brin famously referred to as "parental supervision." Mr.
Schmidt departed Alphabet's board in June.
As they step back further, Messrs. Page and Brin leave their
fingerprints all over the company, with many Google executives as
their handpicked choices. The head of YouTube, Susan Wojcicki, is
Mr. Brin's former sister-in-law and was the company's 16th
employee. The head of Google Maps, Jennifer Fitzpatrick, was in
Google's first class of interns, while search head Ben Gomes was
also hired in the first year.
Alphabet is valued at almost $900 billion. Shares are up roughly
24% this year, lagging behind the broader technology market.
Messrs. Page and Brin created Alphabet in 2015 as a holding
company that separated Google's massive business from other
less-mature units known as moonshots, which were expected to be
unprofitable for many years. All of the units reported to Mr.
Page.
At the time, the design was said to be modeled on the structure
of Warren Buffett's Berkshire Hathaway Inc. Tuesday's moves appear
to mark a return to a more traditional corporate structure. The
company's market value has roughly doubled in the four years since
Alphabet was created.
While Mr. Brin was cut from typically colorful cloth of Silicon
Valley's corporate chiefs -- one former Google executive recalled
him sweating profusely mid-meeting on an exercise bike more than a
decade ago as his subordinates debated acquiring YouTube -- Mr.
Pichai is more muted.
He joined Google in 2004 and is credited with helping popularize
the Chrome web browser and expand the Android operating system. The
soft-spoken executive avoids the spotlight, but he met with
President Trump earlier this year and testified before Congress --
appearances that Mr. Page declined to make himself.
Google's relationship with the government is a hot topic for
staff, who have organized in opposition to plans to expand in China
and to do work for some U.S. government agencies.
In their letter announcing their moves out of daily management,
Messrs. Brin and Page said they would be in regular contact with
Mr. Pichai, "offering advice and love, but not daily nagging!"
Write to Rob Copeland at rob.copeland@wsj.com
(END) Dow Jones Newswires
December 04, 2019 02:47 ET (07:47 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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