With the news of Google's (News - Alert) solid earnings results last night came the news of a stock split of sorts. What Google is planning to do is to issue a non-voting class C shares for every voting class A share. That will end up diluting the voting rights of the shareholders in favor of the executives who own special class shares with multiple voting rights.
Legally speaking there's nothing wrong with any of this. As long as Google is transparent with its shareholders, it can operate as it chooses. But this move signals how badly Google would like to operate as a private company, while profiting from its public side. Perhaps the company is spooked by the challenges at Yahoo caused by years of mismanagement after its founders left or the downward spiral of Apple after Steve Jobs (News - Alert) was forced out, only to be saved by the triumphant return of its founder.
Whatever the case, Google is asking its shareholders to trust the company with its original founders, essentially allowing the company to operate as a private one. That may not be a bad thing for Google but I wonder how many other companies may choose this schizophrenic path of private management and public ownership.
In a perfect world there would be only one class of shares with each representing one voting right. This may not be the right model for every company, but arbitrary financial structuring can eventually lead to complexity and confusion and that's never in the best interest of the shareholder collective.