Google has announced plans to create a new public holding company, Alphabet, and a new operating structure to increase management scale and focus on its consolidated businesses.

In a blogpost, Google chief executive officer (CEO) Larry Page said, “Our company is operating well today, but we think we can make it cleaner and more accountable. So we are creating a new company, called Alphabet. I am really excited to be running Alphabet as CEO with help from my capable partner, Sergey, as President.”

Under the new operating structure, Google will focus on search, ads, maps, apps, YouTube and Android and the related technical infrastructure whereas businesses such as Calico, Nest, and Fiber, as well as its investing arms, Google Ventures and Google Capital, and incubator projects, such as Google X, will be managed through Alphabet.

As part of the new operating structure, Sundar Pichai will be CEO of Google and Larry Page will become chief executive officer (CEO) of Alphabet. Pichai is currently the senior vice-president (VP) of products at Google and oversees product management, engineering and research efforts for Google’s products and platforms. Since joining Google in 2004, he has led a number of key consumer products. Prior to his current role, Pichai served as Google’s senior VP of Android, Chrome and Apps.

The new legal and operating structure will be introduced in phases over the coming months and when finalised, Google expects that it will result in two reportable segments for financial reporting purposes, with the Google business presented separately from other Alphabet businesses taken as a whole.  Alphabet will initially be a direct, wholly owned subsidiary of Google. Alphabet Inc. will replace Google Inc. as the publicly-traded entity and Google will become a wholly-owned subsidiary of Alphabet. The company's two classes of shares will continue to trade on Nasdaq as GOOGL and GOOG.