Larry Page and Sergey Brin's decision to step down is a 'milestone' moment for Google. But some experts say it might not be as big of a deal as it sounds.
- Analysts say Alphabet CEO Larry Page and company president Sergey Brin's decision to step down from their leadership roles doesn't come as much of a surprise.
- That's because Google CEO Sundar Pichai, who will be taking over as the chief executive of Alphabet, has largely been the face of the company since 2015.
- The transition also comes at a critical time for Google as it's been at the center of antitrust concerns along with other tech giants like Facebook and Amazon.
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Alphabet CEO Larry Page and president Sergey Brin are stepping down from their leadership roles at Alphabet, the parent company of the tech giant they co-founded to index the web back in 1998.
It marks a turning point for the company as it signals yet another promotion for Google CEO Sundar Pichai, who has been tapped to take over as the chief executive of Alphabet. Page and Brin will remain involved in the company as shareholders, co-founders, and Board members.
But the transition isn't expected to materially impact the company's daily operations, according to several analysts.
That's because Pichai has largely been the face of the company since he was promoted to become the CEO of Google back in 2015, when the company underwent a corporate restructure that placed the search giant under the Alphabet umbrella. Since then, Page and Brin have largely stepped out of the spotlight, while Pichai has led Google's press events, appeared in Congressional hearings, and made appearances at company town halls.
"Larry and Sergey stepping down from their management roles does not come as a complete surprise, and we do not expect any major change in how Alphabet is run," a team of J.P. Morgan analysts led by Doug Anmuth wrote in a research note dated December 3. That sentiment was shared by analysts from JMP, Cowen, and Evercore ISI as well.
"Although the handoff represents a milestone for GOOG (and the broader tech industry), we also think the appointment of Pichai is a formality for the business," a team of analysts at Cowen led by John Blackledge wrote in a December 3 research note.
But the change could improve transparency when it comes to the company's leadership structure by further boosting Pichai's profile within Alphabet.
"Sundar's promotion likely acts to consolidate power at the top of the world's third-largest company, which prior to this point had been characterized by a degree of fragmentation in organizational structure, if not strategic vision,"says an Evercore ISI report written by analysts Kevin Rippey, Benjamin Black, and Lee Horowitz.
The management shakeup also comes at what may be the rockiest point in Google's history. The search giant is under increased scrutiny from lawmakers and privacy advocates over its business practices and the way it handles and collects consumer data. At the same time, it's been grappling with employee protests regarding various aspects of the company's culture. Several current and former employees criticized Brin and Page on social media for leaving instead of stepping in to address employee concerns.
But fresh leadership under Pichai could be just what the company needs, says Andrew Frank, an analyst at market research firm Gartner covering Google.
"Perhaps putting some distances between Google and the founders is a healthy thing," Frank said to Business Insider. "It's turning the page on what has kind of been a rough period."
With additional reporting by Ashley Stewart
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