Google Now Owns

Alphabet (tiffany terry / Flickr / CC)
tiffany terry / Flickr / CC
Newport Beach, CA

In moves that just get weirder every day, Google–now a wholly-owned subsidiary of Alphabet–has revealed that it owns and were apparently unavailable.

The August announcement by Alphabet, Inc. that Google was going to bust itself up into a series semi-autonomous subsidiaries would supposedly allow founders Larry Page and Sergey Brin to turn over operating control of the world’s largest search engine and basket of unrelated other research entities, while still maintaining central control of corporate cash flow. But the real reason may be to distance the search engine cash cow from the legal–and perhaps existential–risk of an adverse privacy ruling.

Google’s main businesses are Internet-related services and products that include online advertising technologies, search, cloud computing, and software. Google’s cash cow is profits derived from AdWords, which assist content providers and advertisers in delivering their messages to users.

As Breitbart News wrote in “Net Neutrality Passes: Everybody Equal, But Google Much More Equal,” Google in February of 2015 achieved its goal of pushing for maximal FCC “Net Neutrality” and price regulation by having its direct broadband competitors reclassified as the equivalent of Title II telephone utility services.

But the Obama administration FCC that ruled overwhelmingly in favor of Google, could easily rule that broadband is not like a telephone service under a future Republican administration.

The NetCompetition blog does an excellent job of explaining the potential unintended-consequence-risk to Google’s core business of FCC Title II regulation of broadband:

  • Title II regulation necessarily and broadly applies to Google’s business model;
  • Title II strict privacy regulation now applies to Google;
  • Title II escalates legal and privacy risk from Google’s widespread wiretapping;
  • Title II brings more regulatory attention to Google’s poor EEO/diversity record;
  • Title II risks deemed Goggle blocking, discriminating, and paid-prioritization.

Google announced its plans for a new corporate structure in August under the leadership of CEO Sundar Pichai, while Alphabet serves as a collection of companies led by CEO Larry Page.

Page told TechCrunch that the structure will allow the company to “run things independently that aren’t very related,” while also keeping “tremendous focus on the extraordinary opportunities we have inside of Google.

The good news for Google is it currently controls a highly profitable virtual monopoly in Internet search. But that also means it controls a monopoly that could easily be forced to break up under an administration less empathetic to its needs.