Last updated: January 21, 2011 1:33 am

Page becomes Google chief executive

Google has ended the unusual management triumvirate that has led the company over the past decade, elevating co-founder Larry Page to become the first clear head of the internet search giant.

The shake-up comes as Google faces a new competitive challenge from Facebook, which has taken over as the web’s most-watched company.

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IN Technology

Eric Schmidt, who will hand over the title of chief executive to Mr Page in April, said that Google’s three top executives had decided to “clarify” their roles “so there’s clear responsibility and accountability at the top of the company”.

In a Financial Times interview, he denied the changes were prompted by any particular competitive threat, but reflected an attempt to speed up the company’s decision-making as it grappled with “a complex set of opportunities”.

Analysts said the unusual three-man leadership over the past 10 years had proved highly successful, but had outlived its usefulness. “It worked on a smaller scale,” said Youssef Squali, an analyst at Jefferies.

Google’s failure to come up with a response to Facebook, despite several attempts at developing its own social networking services, has prompted the first deep soul searching at the company, which has faced few direct challenges up until now. But the company’s leaders said the changes were prompted more by internal pressures, as Google struggles with challenges caused by its growth.

“Every time we double in headcount the whole company changes a lot,” Sergey Brin, who started the company with Mr Page while the two were graduate students at Stanford University, told the FT. He is to step back, giving up his title of co-president to take responsibility for “special projects”, Google said.

Mr Schmidt, a tech industry veteran who was brought in 10 years ago to provide what some at the company called “adult supervision” for Google’s young founders, will take on the role of executive chairman.

News of the management overhaul came as Google reported earnings that comfortably topped Wall Street forecasts for the final quarter of 2010, reflecting a continued rebound in its online advertising business after the recession.

In one sign of Mr Page’s assumption of full control from Mr Brin, Google said he would take on leadership of its products and technology – roles that previously had been split between the two men.

Google said its revenues rose 26 per cent, reaching $6.67bn net of traffic acquisition costs it pays to other websites. That was ahead of the $6.05bn Wall Street had been expecting. Earnings per share, at $8.75 on the pro-forma basis analysts use to assess the company, were up from $6.79 a year before and above expectations of $8.08.

In a message sent out on Twitter, Mr Schmidt said: “Day-to-day adult supervision is no longer needed!”

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