Google’s restructuring under the Alphabet umbrella means that there’s nothing standing in the way of it taking on every company in the technology sector. That should give every company pause, but Uber in particular should worry about the possibility of Alphabet continuing a fight Google started.
It never made sense for Google to invest in Uber. Both companies want to experiment with businesses that are only slightly related to their original purposes, and these ambitions have often pit the two against each other.
Just look at some of the headlines from recent months. Uber is trying to make self-driving cars and buying companies to reduce its dependence on Google Maps, while Google reportedly works on its own ride-hailing service.
There are other signs that Google and Uber aren’t getting along as well as many investors and portfolio companies, such as Google’s decision to use data from an Uber competitor, Lyft, in an update to its Google Now service.
A cold war is being fought. Neither company has come right out and said that it’s competing with the other, but both have been working on projects that would give them the upper hand when they finally recognize the conflict.
That war has a chance to heat up now that Google founders Larry Page and Sergey Brin have created Alphabet, a new company of which Google will be a subsidiary, so they can work on things unrelated to Google’s online services.
Alphabet’s creation is a warning to every company in the tech sector. The company formerly known as Google no longer has to try to justify working on things like anti-aging research or wireless networks; it’s free to just do them.
It would make sense for Alphabet to focus on ride-sharing. The company has been working on self-driving vehicle technologies for a while, and if Uber chief executive Travis Kalanick is believed, self-driving cars will replace the human drivers currently utilized by ride-hailing startups in a few decades.
Then there are the already-referenced reports about Google working on its own ride-hailing service. It might have been difficult for the company to introduce that service before, but as one venture capitalist already joked, Alphabet isn’t bound by any promises Google might have made to Uber.
Alphabet is all about giving Page and Brin the freedom to do whatever they want. It was clear even when the company was known as Google that they want to compete with Uber — now that they have a little more leeway to explore that desire, it wouldn’t be surprising to see this cold war get heated.