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.
Alphabet (NASDAQ:GOOG)
Historical Stock Chart
From Feb 2024 to Mar 2024 Click Here for more Alphabet Charts.
Alphabet (NASDAQ:GOOG)
Historical Stock Chart
From Mar 2023 to Mar 2024 Click Here for more Alphabet Charts.