Larry Page's First Year as Google CEO: Impatience Is a Virtue

In January 2011, only hours before I had to send back the proofs for In the Plex, the news came out that Larry Page would be taking the helm of the company as the CEO. The transition would occur on April 4 of that year. If it had been anyone else but Larry Page to take over Google, this change would have been ruinous to the project I’d been working on for almost three years. But as I quickly made adjustments to the copy to reflect this change, I realized that my book already reflected a reality that few understood: Page has always been the key visionary of Google and its driving force.

Now that Page has been CEO for a year, everybody knows it.

Since Page took over, he has been exercising an autonomy that is new to the company.Page’s reign has been characterized by focus. Focus on product. Focus on the threat from a social networking movement embodied by Facebook. A focusing of Google itself, from a collection of disparate services to a single one with intermeshed components. And a more focused leadership structure where every employee can cite a single name when asked who is in charge.

Google is Larry’s company now.

This isn’t to belittle Sergey Brin, who was a full partner in co-founding the company and partnering with Larry in its first 13 years. Nor is it necessarily a knock on Eric Schmidt, who proved that experience counts when growing a company from a middling operation to a behemoth. But since Page took over, he has been exercising an autonomy that is new to the company. What was an unconventional arrangement where the big decisions were made via the "troika" of Schmidt and the two founders has morphed to something more conventional, where a single CEO sits at the top of a pyramid.

Supposedly the really big decisions are still made collectively. But when you talk to Googlers, they constantly refer to what Larry thinks, and what Larry wants and what Larry believes.

Though Page seldom speaks directly to the press (more on this later), we do know a lot about what Larry thinks, wants, and believes. One of the primary themes of his first year is his belief that Google is endangered. When I asked him last September (in one of the very rare opportunities for reporters to pose questions to him on the record) what he thought was Google’s threat, the answer was out of his mouth even before I finished the query.

"Google," he said. Page lives in horror of the company being bogged down by inertia, timidity or the sluggishness of bureaucracy.

Thus, one of Page’s first acts as CEO was to reorganize his executives to focus on products. He also arranged to have his top lieutenants work in the same room for a few hours every week to make sure everyone was on the same page. (No pun intended.)

When I asked Larry last September what he thought was Google’s threat, the answer was out of his mouth even before I finished the query.'Google,' he said.

What’s more, Page asked Google’s top executives to commit to the company for several more years. Some of these were very early employees -- and more than wealthy enough to turn tail if they didn’t think the Page regime would be satisfying. Yet they threw their lot in with the new CEO. That was impressive.

But the hallmark of his first year is Page’s response to a different threat -- the impact of Google’s historic failures in the social space.

Page assumed his new role in the midst of a corporate accounting of Google’s shortcomings in the "people" sense, triggered by the specter of Facebook’s accumulation of a massive amount of vital personal data on nearly a billion people. The Googleplex had been seized by low-level panic over this issue. The fear was that without such information, Google might be eclipsed in providing the best experiences for its users.

Page dialed up the anxiety. He moved his office from the building where Search was centered to a location near the Google+ team. He dictated that the annual bonus of all Googlers would be partially dependent on how well the company did in the social space. And in a classic Larry Page response to a problem, he is not satisfied with a solution involving simply a product that competes with Facebook. Larry thinks big. He has enthusiastically backed a plan to have all of Google remade, into a single complex organism fortified with social DNA.

Of course, there are plenty of metrics that show that Google is doing just fine. It takes in $38 billion a year. (Its stock price has been fairly flat, but Page has always insisted that Google focuses on the long-term, not Wall Street's quarterly calendar.) It is the world’s dominant search engine. In YouTube, it has the world’s premier internet video franchise. Its infrastructure is one of the marvels of the 21st century.

Yet Page seems to be running the company as if its survival is at stake -- making a risky bet on integration and “socializing” the company so that it knows its users more intimately and can thusly deliver them a better and more useful experience.

In some ways, operating as if your life depended on it can be a pretty good strategy. Running scared is a good way to log big mileage. To paraphrase Samuel Johnson, a hangman’s noose can provide wonderful focus.

Such urgency helped get Google+ out the door to a surprisingly warm response. There were some genuine innovations (particularly the ease of organizing contacts into "circles"), and a stylishness not often associated with Google products. Critics have been knocking Google+ a lot in recent weeks, but it is by far the most successful social product in the company’s history. Even if you dispute how Google measures usership, the fact is that 500 million people have access to it. And as Google always reminds us, Google+ is not done. It’s an early step to the transformation of the company to a single Google.

The concept is that when all the pieces of Google -- Search, Gmail, Docs, Maps and so on -- make use of what the company knows about you, it can serve you a lot better. This makes a lot of sense, but it’s a tricky thing to execute. People are accustomed using Google products individually. Suddenly being forced to take in the Google experience in one big chunk can be jarring -- and scary.

But that is what Google did this past winter when, with the best of intentions, it dramatically flagged the changes to its privacy policy that would allow such changes to occur. It was a weird case when the headline was frightening (We know plenty about you and we want to use it all! By March 1!) but the details, set in pica, were nowhere as scary (We’re not sharing with third parties, nobody but you sees this stuff unless you specify, you have plenty of controls on what we store, and nothing special is happening on March 1!)

But who reads the fine print?

Compare this to Facebook, which unveiled a product called Timeline last September. The creepy factor is potentially off the charts. (It involves automatically updating your public profile with the books you read, the music you listen to, the places you go and the events you attend.) But users got to enjoy the benefits of the privacy tradeoff immediately. (For lots of people, sharing that stuff is fun.)

Google rolled out its privacy policy well before it delivered the putative benefits of the change. Instead of seeing all the benefits, users faced uncertainty about what Google would actually do.

Worse, the privacy policy was rolled out only a brief time after Google altered its most important product, search, with social results -- mainly from its own social network, Google+. Because services like Facebook and Twitter weren’t equally integrated, critics saw it as an abuse of Google’s market power in search.

Google has since tweaked the product, Search Plus Your World -- and vigorously defends its move. But even some allies were unhappy with the change, and wondered why Google was messing with the crown jewels.

Anyone who has seen Larry Page run an all-hands TGIF session at the end of every week knows he can be incisive, articulate and, yes, charming as he addresses even some fairly barbed questions from employees.That double-shot of poorly received moves shows the downside of urgency. Larry Page is a worshiper at the altar of speed, so it’s no surprise that he wants to address Google’s problems, like, yesterday. A word that often comes up when Googlers discuss their CEO is "impatience." Page seems to believe that impatience is a virtue; good things come to he who does not wait.

But impatience can lead to mistakes. Not long after the flaps about social search and privacy, Google got a black eye when it revealed that it had messed with the privacy settings of the Safari browser. Google’s intent was simply to allow its "+1" ads to work properly, an arguably reasonable move. But Google poorly implemented the actual tweak, leading to a more serious violation of Safari’s settings.

Such errors may be common among internet companies. But Google long ago reached the point where its every move is closely scrutinized. Doing things right in that atmosphere can sometimes require ... patience.

Page will always be dealing with that tricky balance -- go fast and make mistakes, or move deliberately and lose opportunities. Maybe in the long run, it’s best that he’s a go-fast guy. (It’s certainly the Googley way!) But there is price for that, and he paid it in those instances.

The social sphere was not the only big challenge for Page in year one. Another threat has been patent litigation. Most notably, Google’s Android system has been under attack by those who claim that it infringes on their intellectual property. (Page has gotten insufficient credit for his prescience for buying Android, then a modest startup, in 2004. Were it not for this purchase, Google’s biggest problem in 2011 might have been the mobile space, not the social one.) Never mind that some of the patent claims are bogus or overly broad: The traditional response by big companies is to counter-sue with in-house patents. But as a young company, Google has too few of those.

Page attacked his patent gap in a characteristic fashion: He sought a solution by broadening his response beyond the specific problem. Instead of just buying a patent portfolio (an approach that was challenging anyway, since Google’s competitors were collaborating to snatch up the ones on the market), he bought a whole company -- Motorola Mobility. We know what he intends to do with the patents -- use them to sue Apple and other competitors until they sit down at the bargaining table and declare mutual disarmament. But what he intends to do with the handset manufacturer he now owns is a mystery.

The least likely possibility is that Page will operate Motorola with few changes. Google thrives on disrupting industries, and now it has the chance to rethink the hardware world. It’s unimaginable that Page won’t do something interesting. Will his schemes justify the huge purchase? Will expanding Google’s headcount by nearly 20,000 Motorola employees overwhelm Page’s attempts to stave off bureaucratic paralysis? Way too soon to tell.

One thing that Page has not done in his first year is assume the bully pulpit for the company to present Google’s side of the story in some of its more controversial moves. That has been a costly omission.

Google was once widely viewed as a feisty startup, an underdog that was on the side of the people; now people increasingly see it as a mighty and distant power that knows too much about them.

This shift in perception is dangerous to Google. It provides cover to politicians and regulators (many of whom are being lobbied furiously by Google’s competitors) who want to hobble a company that seems to have a troubling amount of power. The constant scrutiny of the DOJ and the FTC have already hurt Google considerably: When considering acquisitions, there’s not only the possibility that government will block the move -- there’s the certainty that the long approval process will lower the value of the purchase.

Though Eric Schmidt (who now holds the amorphous post of executive chair) has done yeoman service in defending Google to legislators, regulators, and tech conference attendees, there’s no substitute for hearing the company’s story from the guy in charge. Instead, we hear more from ex-employees who gripe that Google has lost its soul than we do from the leader who is the soul of Google.

Anyone who has seen Larry Page run an all-hands TGIF session at the end of every week knows he can be incisive, articulate and, yes, charming as he addresses even some fairly barbed questions from employees. In the first earnings call after he became CEO, Page put in a very brief and content-free cameo appearance and got slammed for it. The next call, he participated fully, and acquitted himself nicely. A smart fellow like Larry Page will certainly come to understand the value of doing the same thing with the media.

One expectation of Larry Page’s first year has been fulfilled indisputably. He has not been dull. I suspect that will be the case for Year Two.

UPDATE: Within minutes after posting this, my prediction that Page would figure out that it makes sense to give a media interview proved prescient. Here's what he said to Business Week.

Opinion Editor: John C. Abell @johncabell