Can Page open new chapter?
By Alexei Oreskovic and Paul Thomasch |
January 24, 2011, Monday
|
Print Edition
Print Edition
ONE day after Google's surprise announcement that Larry Page would once again run the company, investors and industry insiders were wondering if he is up to a now very different job.
The 38-year-old co-founder of the world's No. 1 Internet search company will replace Eric Schmidt as chief executive officer in April, at a time when Google Inc is facing tough competition from Facebook and Twitter.
It seems straight out of a well-worn Silicon Valley script - but with which ending?
"Founder becoming CEO. Is this like a Steve Jobs returning or a Jerry Yang returning?" Chris Dixon, a technology veteran mused on Twitter, alluding to the two extremes of the tech industry storyline.
Steve Jobs returned to Apple Inc in the 1990s to save the company he founded from near insolvency. Since his return, Apple has set the agenda in technology and culture with the iPhone and iPad.
Yahoo! Inc's Jerry Yang made a similar comeback, returning to his Internet company during a troubled stretch, but failed to restore its fortunes.
For Google, which dominates the search market and generated roughly US$29 billion in revenue last year, the need for a change lacks the urgency that accompanied Jobs' return to Apple.
But analysts say the popularity of social networking services such as Facebook and Twitter, as well as online coupon service Groupon, pose a growing threat to Google's business.
Google, whose stock underperformed the market in 2010, has struggled to develop its own social networking products and has seen many of its engineers and executives decamp to Facebook.
Meanwhile, new, smaller competitors in the online search market are pecking away at its reputation. They say Google search result quality, a hallmark of the search giant, has been deteriorating.
The attacks prompted Google, in a post on its official blog, to defend its record and promise to improve quality.
Page, who co-founded Google with Sergey Brin 13 years ago, will try to steer the company back to the forefront of online innovation but must also run day-to-day operations of a 24,000-person organization - a far cry from his last time at the helm.
"My fear would be you don't have a guy like Eric who keeps the trains running on time," said one former Google employee.
"I'm having a hard time imagining Larry going from the role I've seen him in, to going to a CEO role," he added.
"He can't come in and lay on the couch as he used to do and sort of interject here and there. Someone's got to lead the meetings."
Google hopes the management change will speed up decision making. Page will take charge of the company's day-to-day operations, while Schmidt will focus on deals and government outreach, among other things, as executive chairman.
The track record for entrepreneurs becoming CEOs is not so good, said Michael Cusumano, a professor at the MIT Sloan School of Management, citing Michael Dell's return to the PC maker as another less-than-spectacular example of a founder jumping into the driver's seat.
The 38-year-old co-founder of the world's No. 1 Internet search company will replace Eric Schmidt as chief executive officer in April, at a time when Google Inc is facing tough competition from Facebook and Twitter.
It seems straight out of a well-worn Silicon Valley script - but with which ending?
"Founder becoming CEO. Is this like a Steve Jobs returning or a Jerry Yang returning?" Chris Dixon, a technology veteran mused on Twitter, alluding to the two extremes of the tech industry storyline.
Steve Jobs returned to Apple Inc in the 1990s to save the company he founded from near insolvency. Since his return, Apple has set the agenda in technology and culture with the iPhone and iPad.
Yahoo! Inc's Jerry Yang made a similar comeback, returning to his Internet company during a troubled stretch, but failed to restore its fortunes.
For Google, which dominates the search market and generated roughly US$29 billion in revenue last year, the need for a change lacks the urgency that accompanied Jobs' return to Apple.
But analysts say the popularity of social networking services such as Facebook and Twitter, as well as online coupon service Groupon, pose a growing threat to Google's business.
Google, whose stock underperformed the market in 2010, has struggled to develop its own social networking products and has seen many of its engineers and executives decamp to Facebook.
Meanwhile, new, smaller competitors in the online search market are pecking away at its reputation. They say Google search result quality, a hallmark of the search giant, has been deteriorating.
The attacks prompted Google, in a post on its official blog, to defend its record and promise to improve quality.
Page, who co-founded Google with Sergey Brin 13 years ago, will try to steer the company back to the forefront of online innovation but must also run day-to-day operations of a 24,000-person organization - a far cry from his last time at the helm.
"My fear would be you don't have a guy like Eric who keeps the trains running on time," said one former Google employee.
"I'm having a hard time imagining Larry going from the role I've seen him in, to going to a CEO role," he added.
"He can't come in and lay on the couch as he used to do and sort of interject here and there. Someone's got to lead the meetings."
Google hopes the management change will speed up decision making. Page will take charge of the company's day-to-day operations, while Schmidt will focus on deals and government outreach, among other things, as executive chairman.
The track record for entrepreneurs becoming CEOs is not so good, said Michael Cusumano, a professor at the MIT Sloan School of Management, citing Michael Dell's return to the PC maker as another less-than-spectacular example of a founder jumping into the driver's seat.
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