Google announced an overhaul of its operating structure on Monday, creating a holding company called Alphabet to pool its many subsidiaries and separate the core web advertising business from newer ventures. Google announced an overhaul of its operating structure on Monday, creating a holding company called Alphabet to pool its many subsidiaries and separate the core web advertising business from newer ventures.

The new company will be run by Google's founders Larry Page as CEO and Sergey Brin as President. Google said it would split into two reporting companies under Alphabet. One will hold its core search and Web advertising business, and the other its newer ventures such as driverless cars and Internet-connected thermostats made by its Nest business.

Google's overhaul of its operating structure is an acknowledgement of the lack of transparency surrounding its disparate businesses and projects, but it remains to be seen how much more the company will actually disclose.

"Alphabet is mostly a collection of companies. The largest of which, of course, is Google. 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," said Larry Page. "What do we mean by far afield? Good examples are our health efforts: Life Sciences (that works on the glucose-sensing contact lens), and Calico (focused on longevity)."

"Fundamentally, we believe this allows us more management scale, as we can run things independently that aren?t very related..."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. In addition, with this new structure we plan to implement segment reporting for our Q4 results, where Google financials will be provided separately than those for the rest of Alphabet businesses as a whole."Sundar Pichai, Google's new CEO, will controls the suite of existing Google products and services.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.

Alphabet will also include Google's X lab, which incubates new efforts like Wing, a drone delivery effort.