Top executives from Uber, Lyft and others are in talks to join Alphabet Inc.’s newly formed parent company Alphabet Inc. to form the first company to offer ridesharing services on mobile platforms.
The deals represent the latest sign of Alphabet’s plans to compete head-on with ride-hailing companies such as Uber and Lyft, which have grown rapidly in the last decade and are now valued at about $700 billion.
Alphabet Chief Executive Officer Eric Schmidt said the companies would each share revenue from their services.
“There’s nothing wrong with us doing these deals, but we’re in a different space, and it’s not going to be for a while,” Schmidt said.
Alphabet is expected to launch the service in the second half of next year.
Alphabet has been a leading player in the rideshailing business, where it has invested billions of dollars to buy competitors and develop new technology.
The companies are also in talks with other ride-sharing services such as Lyft and Sidecar.
The new Alphabet deal will be announced at a conference call on Wednesday.
“The ride-share industry has exploded in the past 10 years and there’s no better way to bring more consumers to our platforms than with a company like Alphabet,” Lyft CEO Travis Kalanick said in a statement.
“Our goal is to create a great ride-service platform, and we are thrilled to be part of Alphabet.”
Alphabet did not disclose the value of the deal.
Uber said it planned to begin operating in California and New York by 2021.
Lyft, meanwhile, has launched in Texas and Arizona.
The ride-services companies said the deals would provide them with more resources to develop their services, and could also help boost revenue.
Uber, which is currently based in San Francisco, has a network of more than 100 cities.
The company’s drivers earn about $8 an hour, while Lyft’s average earnings are $2 an hour.
Alphabet said it would offer a range of features to both ride-sharing and driverless cars, including automatic payments for fares and a “smart car” for the car’s onboard technology.
Alphabet will also allow its driverless car to operate on its own network and has been testing the technology on its cars in California.
The two companies are working to establish partnerships with other carmakers, including Mercedes-Benz and General Motors.
The deal was announced Tuesday in a regulatory filing by Alphabet, which also confirmed that it would take a minority stake in Uber.
Alphabet declined to comment on the deal on Wednesday, but Google said in an emailed statement that the companies have “been in the market for a new way to deliver rides.”
Alphabet’s new company is named Alphabet Inc., which stands for Alphabet Inc..
Alphabet Inc.: Alphabet Inc is Alphabet’s parent company.
It is an acronym for the words “original intent.”