Google gets an overhaul and a new CEO: Sundar Pichai

Google founders Larry Page and Sergey Brin have started a new "collection of companies" called Alphabet -- and it includes Google. That's right, now there's a company bigger than Google. In a letter to investors, Page outlined Alphabet and the changes this new organization will bring, including the appointment of a new Google CEO, Sundar Pichai. Page is now CEO of Alphabet, while Brin is President. Alphabet comprises Google and other companies that have been housed under its primary-colored umbrella, including the X lab (which is building delivery drones), investment arms Ventures and Capital, and health-focused efforts Calico and Life Sciences. "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 writes.

Alphabet puts a lot of power in Brin and Page's hands. As Page explains it: "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."

Page and Brin will provide Google's financial information separately from Alphabet's in its Q4 results, Page says. To be clear, Google is now a wholly owned subsidiary under Alphabet. For investors, Alphabet Inc. replaces Google Inc. in the public sector and all Google shares will automatically convert into the same number of Alphabet shares, including all current rights. Current Google Chief Business Officer Omid Kordestani will transition to a new role as Advisor to both Alphabet and Google, according to the new company's SEC filing. YouTube, for its part, remains under Google and retains its own CEO, Susan Wojcicki.

"I should add that we are not intending for this to be a big consumer brand with related products -- the whole point is that Alphabet companies should have independence and develop their own brands," Page says.

As for the name, Page adds that language is at the core of Google search. Plus, "it means alpha‑bet (Alpha is investment return above benchmark)." Besides, Alphabet can be a great workout: