GOOGL Alphabet Inc

By Rob Copeland 

Google's co-founders stepped down from their active management roles at the internet giant, surrendering further control at a potential inflection point for the company.

Billionaires Larry Page and Sergey Brin, who had been chief executive and president, respectively, of Google parent Alphabet Inc., said they would hand control immediately to Sundar Pichai, Google's existing CEO.

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 novel 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 much of the tech industry 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.

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."

The duo are hardly giving up their influence. They remain on Alphabet's board and together control a majority of voting power over company decisions under Alphabet's dual-class share structure.

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. Thursday'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.

Write to Rob Copeland at rob.copeland@wsj.com

(END) Dow Jones Newswires

December 03, 2019 18:23 ET (23:23 GMT)

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