Report : Alphabet Inc. To Ask Subsidiaries To Pay For Corporate Services

(RTTNews) - Google parent Alphabet Inc. (GOOGL, GOOG) is moving to make its disparate parts more accountable internally for spending, in an effort to ensure that its more speculative projects are self-sustaining the Wall Street Journal reported citing people familiar with the matter.

As per the new system, "bet" companies such as Google X, Google Fiber and Google Life Sciences will be charged for using corporate services such as computing, recruiting and marketing, the report said.

The changes are part of Google's transformation into a conglomerate, which took effect in August but won't be reflected in financial statements until next year. The executives hope to make the bet companies more accountable for their costs, which may lead to more caution on spending, the report said.

The reorganization has two goals. Alphabet Chief Executive Larry Page wants to boost spending on new technologies that will take the company into areas such as transportation, communications and health care. At the same time, Mr. Page and other executives want to assure Wall Street that Alphabet is spending responsibly.