In a blog post today, Google co-founder Larry Page announced a massive restructuring of the company, instituting Sundar Pichai as CEO and shifting himself and co-founder Sergey Brin to a larger holding company called Alphabet. As CEO and President of Alphabet, Page and Brin will oversee Google as well as affiliated companies like the life-extension project Calico and a drone delivery venture called Wing. Alphabet will also direct Google's early-stage funding operations, dubbed Capital and Ventures. Under the new organization, each of those operations will have its own CEO and leadership, while Pichai and Google retain control of search, ads, maps, the Google Play Store, YouTube, and Android.

The reorganization also involves significant financial restructuring, as detailed in an associated SEC filing. All Google shares will now be traded as shares of the larger Alphabet holding company, news that drove the company's share price up more than four percentage points in the wake of the announcement. "We’ve long believed that over time companies tend to get comfortable doing the same thing, just making incremental changes," Page writes in the post. "But in the technology industry, where revolutionary ideas drive the next big growth areas, you need to be a bit uncomfortable to stay relevant."

"In the technology industry... you need to be a bit uncomfortable to stay relevant."

It also means a prominent role for Sundar Pichai, the former Chrome OS and Android chief who has played an increasingly central role in Google's day-to-day operations. "It is clear to us and our board that it is time for Sundar to be CEO of Google," Page said in the post. "I feel very fortunate to have someone as talented as he is to run the slightly slimmed down Google and this frees up time for me to continue to scale our aspirations."

While the news has caught Wall Street and much of the tech world by surprise, it's an extension of a shift that's been ongoing within Google for some time, with Brin and Page increasingly interested in ambitious projects launched through Google X or outside funding. Alphabet formalizes that division, separating Google's traditional products from the more ambitious ventures that critics have accused of distracting from the company's core strengths. It remains to be seen how the new divisions will play out in practice, but the intention seems to be a renewed focus on both Google's current products and the moonshots that aim to replace those products as Alphabet's focus in the decades to come. "From the start, we’ve always strived to do more," Page writes, "and to do important and meaningful things with the resources we have."

Verge Video: Sundar Pichai’s plans for Google