FT: Eric Schmidt steps down as Alphabet chairman

By Richard Waters in San Francisco

Eric Schmidt is to step down as executive chairman of Google’s parent, Alphabet, ending the unusual 17-year triumvirate arrangement that oversaw the creation of the world’s biggest internet company.

The 62-year-old engineer will step aside from the role at the next board meeting in January but remain a technical adviser and continue to have a seat on the board, Alphabet said on Thursday.

Mr Schmidt handed over the chief executive title to Google co-founder Larry Page seven years ago. But he has remained the public face of Google and its parent company around the world, handling many policy issues and dealing with regulators and politicians as the company has come under increasing scrutiny.

His close identification with Hillary Clinton’s failed presidential campaign brought unwelcome attention as Google, along with other big tech companies, has faced political and regulatory pressure in Washington this year.

In the run-up to the election, when Mrs Clinton was widely expected to win, his backing was viewed as a canny move, continuing a relationship Mr Schmidt had forged with the Obama White House. It was also seen as a possible jumping-off point for the Google chairman into a political career. However, the risky political bet backfired after Donald Trump was elected.

Mr Schmidt was at the centre of another political storm this summer when an economist who questioned the company’s growing market power was pushed out of the New America Foundation, an organisation that had significant financial backing from both Google and Mr Schmidt personally.

Despite the mis-steps and reports of increasing tensions at the top, some people who have worked closely with both Mr Schmidt and Mr Page have played down suggestions that Mr Schmidt’s position was in question. Leaving Mr Schmidt to front the company around the world suited the reclusive Mr Page, who prefers to focus on long-term technical issues and has little patience for political expediency.

. . . Can’t wait to dive into the latest in science, technology, and philanthropy

Eric Schmidt tweet
A spokesperson for Google said that Mr Schmidt’s move had been under discussion for more than a year, and that the role of full-time executive chairman was no longer needed after the creation of holding company Alphabet in 2015.

That elevated Sundar Pichai, Google’s top engineer, to the new role of chief executive of the internet company, leaving Mr Schmidt one step removed from the business which still accounts for 99 per cent of Alphabet’s revenues.

Mr Schmidt could not immediately be reached for comment, and the company said his only public statement would be a tweet in which he said he “can’t wait to dive into the latest in science, technology, and philanthropy”.

A well-regarded engineer with experience in the highly technical field of corporate software, Mr Schmidt was little known outside Silicon Valley when he was plucked from obscurity in 2001 to run the search engine company founded by Mr Page and Sergey Brin, two Stanford University graduate students. At the time, he referred to himself jokingly as the “adult supervision”, brought in to provide management experience. However, the joke masked tensions, as Google’s outside investors had lent on the youthful co-founders to cede management control to a more experienced executive.

The relationship between the three men — with Mr Schmidt still beholden to the founders, who retained majority control of Google — underpinned a decade of rapid growth, until Mr Page took over as chief executive. Mr Schmidt’s stake in the company has roughly halved over the past 10 years, though he still holds $4.9bn worth of Alphabet stock.

Mr Schmidt will continue to advise several Alphabet businesses, the company said, including its “smart cities” subsidiary, Sidewalk Labs, and its healthcare initiatives.

The Google chairman has played a prominent public role in recent years in trying to shape views about artificial intelligence, anticipating earlier than many in the tech industry that the technology would spark a backlash if it led to widespread job losses.

Source: Financial Times

Image Courtesy: Financial Times