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Google needs Larry Page to take the helm


Larry Page will take over at Google on April 4. Photo: Getty Images

Larry Page will take over at Google on April 4. Photo: Getty Images

Larry Page will take over at Google on April 4. Photo: Getty Images

The news that Eric Schmidt, long running chief executive of Google, is to step aside making for room for the company’s co-founder, Larry Page, take the hot seat, is good news for shareholders and users alike.

A decade on from the time when Schmidt was brought in by Google’s techie co-founders, Page and Sergey Brin, to run the business like the major company it needed to become, Page is stepping up to the plate.

Tweeting yesterday, after the announcement was made, timing in with Google’s healthy fourth quarter profits, Schmidt wrote: “Day-to-day adult supervision no longer needed!”

Despite its slightly patronizing tone, the tweet confirms the roles the trio have been happy to assume for the last 10 years: Schmidt – the all-knowing businessman father-like figure, to Brin and Page’s teenage-esque ‘son’ cameos.

That is until now. It is pretty much undisputed that Schmidt, as his impressive CV promised Brin and Page, (a Silicon Valley veteran and former chief executive of major software company Novell), has been a successful chief executive.

Google has certainly come a long way under his long tenure, and Schmidt is correct when he says that Google “search has quite literally changed people’s lives - increasing the collective sum of the world’s knowledge and revolutionizing [digital] advertising in the process”.

Yesterday’s financials speak for themselves: Google reported a better-than-expected 29pc increase in full-year pre-tax profits to $10.8bn (€7.9bn) and a 22pc increase in pre-tax profits in the three months to the end of December to $3.1bn on revenue up 26pc to $8.4bn.

However, there is the small matter of the future to consider. Not all is rosy in Google world. The company may still be the undisputed kings of search, with a fabulously profitable advertising model, but with spammers increasingly exploiting its search algorithm, an EU anti-trust investigation in motion after suspicions that the company cross-promoted its own services in its own search results and the lack of a social strategy as Facebook goes strength to strength, Google needs this management shake-up.

Plus there are also the prescient matters of finally trying to make YouTube profitable and regaining the public’s trust after failed social network experiments such as Google Buzz, which connected Gmail users’ accounts based on who they emailed the most without their permission, and the Streetview backlash.

This all has to happen while the 23,000 strong company continues to expand and keep apace with innovation occurring in its rival companies’ labs.

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So who is Larry Page? And what can he do now that he couldn’t do while in his former position as co-founder and president of products for the last 10 years?

Page, after which Google’s PageRank algorithm, the system that decides where web pages should rank in search results, is named, is a computer scientist known for his meticulous nature and eye for detail.

The son of two computer scientists, he met Brin at Stanford University, while completing the Ph.D. program in computer science.

Sharing a mission to organise the world’s information they began developing Google and started the business in 1998.

Now worth $17.5bn (€12.8bn) at 37 years old, according to Forbes magazine, he is one of the richest people in the world, but like his equally rich co-founder, Page retains a low profile – a privilege no longer his to enjoy as he steps into the CEO role.

Nobody can know yet what Page will do differently but if tech history is anything to go by, its usually only a good thing for investors and consumers alike when the founder, with the original vision, remains at the helm of his or hers product.

The overused example is Steve Jobs’s hugely successful return to Apple, which saw him reinvent the ailing technology company’s fortunes.

Ironically the news of Page’s ascension comes only days after Jobs announced his second sick leave stint. But unlike Jobs, Page never went away, so perhaps not a fair comparison.

Mark Zuckerberg, Facebook’s hugely focused founder, chief executive and single largest shareholder, is probably a more apt comparable.

Over the last five years, he has consistently rejected buyout offers, including reportedly from Google, and defied pressure to float the rapidly expanding business.

He has done of all of that so he can focus solely on making Facebook the product he intends it to be for the most important people of all: its users.

He’s employed other people to monetise it such as chief operating officer, Sheryl Sandberg, who is believed to be the key figure in negotiating Goldman Sach’s recent investment in the site.

Those two aims have collided spectacularly on several occasions resulting in some notable privacy gaffes, such as the sharing of users’ data without their knowledge with third party app companies at the end of last year.

However, it is proved and tested that when a founder remains in the driving seat of their business, it ensures a quality of product and energy level, which management buyouts can never replicate.

While Zuckerberg has stayed with Facebook and prospered, Bebo, which its co-founder Michael Birch sold to AOL, has fallen by the way side.

The same is true of the once mighty MySpace, which its founders sold to News Corporation, and is now on its uppers. And of Last.fm, the popular music service, its East London founders flogged to CBS, now facing dwindling popularity in the UK, as other music services, such as Spotfiy, supersede its influence.

Page knows Google from the inside out. And he’s been there for the whole journey, learning some much-needed business savvy from Schmidt, while toiling away on the product in the background.

Business acumen combined with founder’s vision and extreme technological capability, is what Page seems to be bringing to the table.

But it is important to note, that Schmidt has not left Google – or even stepped ‘down’. In his new role as ‘executive chairman’, he is definitely stepping aside and will still be on hand whenever and for however long Page decides that he needs him.

Of his new role Schmidt said: “I will focus wherever I can add the greatest value: externally, on the deals, partnerships, customers and broader business relationships, government outreach and technology thought leadership that are increasingly important given Google’s global reach; and internally as an advisor to Larry and Sergey.”

Brin, now with the title of co-founder, is to devote his time to strategic projects, in particular working on new products.

So as Schmidt exits stage left to his new throne in the wings, Page is finally ready to take the lead, some 13 years on from co-creating Google.

He’s now got the mighty task on ensuring Google keeps its place at the top tech of food chain and finally cracks social networking. Zuckerberg better watch his back.

Telegraph Media Group Limited [2022]

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