Google Exec Tim Armstrong Named New AOL Chairman & CEO

One of Google’s longest serving executives, Tim Armstrong, is departing the company to become AOL’s new chairman and CEO, replacing existing chair and CEO Randy Falco. From the AOL release:

Tim Armstrong, Google Senior Vice President, has been named Chairman and CEO of AOL, LLC, Time Warner Inc. (NYSE:TWX) Chairman and CEO Jeff Bewkes announced today. Current AOL Chairman and CEO Randy Falco and President and COO Ron Grant plan to leave the company after a transition period.

In making the announcement Mr. Bewkes said: “Tim is the right executive to move AOL into the next phase of its evolution. At Google, Armstrong helped build one of the most successful media teams in the history of the Internet — helping to make Google the most popular online search advertising platform in the world for direct and brand marketers. He’s an advertising pioneer with a stellar reputation and proven track record. We are privileged to have him preside over AOL as its audience and programming businesses continue to grow and its advertising platform expands globally. He’ll also be helpful in helping Time Warner determine the optimal structure for AOL”

Tim Armstrong said: “I’m very excited about the opportunities presented in leading AOL. AOL has a wide-ranging set of assets and audience. The company is well positioned to enhance those assets into a larger share of the Internet audience and advertiser communities. AOL and Google have been partners for years and I look forward to collaborating with Jeff Bewkes and his team as we explore the right structure and future for AOL.”

Mr. Bewkes added: “Randy led AOL in its transition from a subscription business to an audience business. Under Randy and Ron, AOL’s programming sites exhibited year-over-year growth in unique visitors for 23 consecutive months with many of its sites now in the top five of their categories., They also assembled Platform-A, the number one display ad network in the U.S. with a reach of more than 90%. They also aggressively cut costs as they restructured the Audience business portion of the company into three distinct operating units: People Networks, MediaGlow, and Platform-A. As Randy and Ron move on, they leave AOL with our gratitude and appreciation for remaking the company and bringing it to a new and promising level.”

Armstrong has been serving as as a senior vice president at Google and “President, The Americans Operations,” where he oversaw ad sales and operations for the American continents. He’s one of the oldest-serving executives that Google has (see Megachart & Analysis: Google Executive Management Changes, 2000-2008) and one of the still relatively few high ranking ones to depart.

Taking over AOL puts an new twist on the company’s future. Yahoo and Microsoft have both been interested in the company. Google still has a 5% interest in AOL and last month told the company it was exercising its right to demand AOL be spun off or for AOL parent Time Warner to buy back Google’s stake.

Coming from Google, Armstrong’s likely to be Google friendly. That means he potentially might push to preserve Google’s existing partnership with AOL and prevent any Yahoo-AOL tie-up. Yahoo would love to gain AOL’s search share (though that’s declined massively since the original Google deal was done). Microsoft would love to acquire Yahoo’s search business and thus inherit any AOL deal.

Of course, I’d expect Armstrong to act in AOL’s own best interests, not Google — and just coming from Google doesn’t guarantee that Google gets any favors. But it certainly does give them a much closer connection to AOL than either Yahoo or Microsoft will have.

For more, see related discussion on Techmeme.