Just as Silicon Valley was starting to come to terms with the sudden departure of Apple founder and CEO Steve Jobs, another technology giant dropped a bombshell: Google CEO Eric Schmidt said he is stepping down to become executive chairman of the company. Schmidt says he will focus primarily on government relations, while Larry Page is going to take back the CEO role he held until Schmidt arrived to take the job in 2001. Although Schmidt will still be around to advise on various matters, the executive shuffle makes it clear that Larry Page is now in sole control of the web giant. But does he have what Google needs? That’s not obvious.

After the news broke Thursday afternoon, Schmidt posted a message on Twitter that linked to his blog post about the changes, also writing “day-to-day adult supervision no longer needed!” That comment was a reference to the fact that Schmidt — a former senior executive with Sun Microsystems — was seen by many as the “adult supervision” the two young billionaires needed in 2001, when they were planning the stock offering that eventually came in 2004. The memories of the tech implosion of the late 1990s were so fresh still that many clearly felt Page and Brin needed to be stopped before they blew all Google’s money, and since Schmidt looked the part of a senior executive, the company’s backers felt he would go over better with investors.

Over the past 10 years, Schmidt has repeatedly stressed — as he did in his announcement and on the earnings call — that although he was the chief executive, he and the two founders have functioned more or less as a triumvirate, advising each other and debating various courses of action. Schmidt has suggested this is because of the mutual respect each had for the other, but his role was undoubtedly also influenced by the fact that Page and Brin share ultimate voting control of the company, thanks to their majority ownership of Google’s multiple-voting shares.

Now, Page has taken the reins as CEO, and Schmidt made it clear in his blog post about the news that this was done “to simplify our management structure and speed up decision making.” After the split, each member of the triumvirate seems to be taking on the role for which he is arguably the best qualified: Schmidt, who is the most senior (and tends to wear a suit), becomes the public face of the company when it comes to government: meeting with senators who are investigating the company’s privacy infractions, for example, or appearing before congressional committees, the FTC, and so on. Page becomes the day-to-day leader, and Brin gets to spend time on the projects he enjoys (which may or may not include self-driving cars).

How Schmidt performs in the governmental role remains to be seen. He might have to tone down his penchant for inappropriate jokes about how people “can just move” if they don’t want their houses to be photographed by the Google StreetView car, or his comments about how “If you have something that you don’t want anyone to know, maybe you shouldn’t be doing it in the first place.” That’s probably not going to go over well in Washington.

The reality is, Google is facing challenges on a number of fronts. Yes, it turned in another stellar performance in the most recent quarter, with revenues climbing by 26 percent to $8.4 billion. The search-related advertising business is still doing extremely well, and that cash cow has allowed the company to do many other things, including promoting the Android operating system and running a number of popular (but money-losing) services such as Gmail and YouTube. But the tech giant has been unable to get much traction on the social-web front, and that has led to criticism that it’s losing the battle — or is at least in danger of losing the battle — for both users and advertisers to Facebook, whose share of the online-ad pie is growing at a phenomenal rate.

Critics are also getting more vocal about the rapid deterioration of Google’s search results, its core business, thanks in part to the contributions of “content farms” such as Demand Media, with many saying Google hasn’t done enough about the problem because it gains ad revenue from those publishers. Then there are the governmental hurdles Schmidt is expected to help the company leap: a potential antitrust investigation by the Department of Justice into Google’s proposed acquisition of travel-information provider ITA, along with pressure from Congress on the company’s approach to privacy, and continued difficulties with foreign governments like Italy and China.

Larry Page is taking the helm at what could be a turning point for Google. Its core business is under fire; it’s losing ground to Facebook in an important new market; and it’s still relying on search-related ads — a market getting long in the tooth — for 90 percent of its income. It has been unable to build any substantial new businesses, despite a number of attempts, including its recently rebuffed $6-billion acquisition offer for Groupon. As angel investor Chris Dixon put it, some Google watchers are probably asking: Is Page’s return like Steve Jobs coming back to Apple in 1997, or is it more like Jerry Yang’s return to Yahoo in 2007?

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Techmeme, the technology-news aggregator that is like CNN for many geeks and tech fans, has given its seal of approval to the idea that Twitter is a real-time news network — founder Gabe Rivera announced today that tweets will now be highlighted as headlines on the site, if they meet his newsworthiness criteria, and even Twitter messages that refer to a breaking news story can make it onto Techmeme if they are noteworthy in some way, or posted by influential users. But will this new feature provide the site with more news to choose from sooner, or will it overwhelm the service with noise?

I admit that my first response to the news (which I saw on Twitter, naturally) was that it didn’t really seem to make a lot of sense. It seemed a little like printing text messages on the front page of the newspaper, in some ways. Much like Twitter, text messages are for chatting and banter, while the front page of a paper is where the important headlines and story excerpts are supposed to go. And Techmeme is very much like the front page of a newspaper, except it’s a newspaper that is devoted solely to technology, and it is updated minute by minute, and sometimes even second by second. Wouldn’t mixing an informal chat-oriented medium like Twitter mess up the headline aspect of the site?

In looking at the current example of the feature, which is Rivera’s own tweet followed by a lot of @ replies, it does seem quite noisy. There are dozens and dozens of comments of 140-character or less attached to the original, and none of them really add a lot to the conversation (including mine, I confess). Or rather, some of them might add something, but it’s really hard to tell which ones, or to sort through them all looking for meaning. On Techmeme’s sister site Mediagazer, where tweets are mixed in with blog headlines, it’s hard to tell what is a tweet and what is a link to a blog post, which presumably would have more to add than just a single offhand comment.

That said, however, Rivera makes a good case in his blog post that tweets can in many cases be news, or make news — such as an announcement from a company that is launching something, or a rumor posted by a celebrity. Another example the Techmeme founder uses is the tweet from former Twitter engineer Alex Payne that seemed to signal unpleasant changes coming for third-party Twitter developers, and was eventually followed by exactly that. In that case, however, it’s arguable that the tweet only became news because TechCrunch wrote about it and put it in context. Would the tweet itself have made Techmeme without the context that blog post provided? I don’t think so.

In any case, it’s interesting that Rivera sees tweets as potentially newsworthy enough to make it part of his news-filtering service — something venture capitalist and blogger (and Twitter investor) Fred Wilson was suggesting might happen as far back as 2008, before many people had even recognized that Twitter was a worthwhile service, let alone a real-time information network. And presumably, the Techmeme founder will apply the same combination of algorithm-driven selection and human filtering that he has to the headlines to keep tweets from overwhelming the site. And Twitter now has another thing to point to that confirms it is a real news network.

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This data on mobile browsing in Africa comes by way of Opera’s monthly State of the Mobile Web report, the most recent version released just this morning. Most of the report focuses on the standard bits: information showing the amount of data that Opera web users consumed, how much bandwidth is saved by Opera’s money-saving compression technology and so on. But more interesting to me is the last section, which is completely devoted to mobile browsing in Africa. Some additional highlights:

• Mobile web data transferred in the ten African countries with the most page views is up 331 percent.
• Those top ten nations using Opera Mini include: South Africa, Nigeria, Egypt, Kenya, Ghana, Sudan, Libya, Tanzania, Zimbabwe and Namibia.
• Sudan, at 4908.2 percent, and Zimbabwe, with 2321.6 percent, lead the region in terms of annual page-view growth.
• These same two countries show the most annual growth in unique users: Zimbabwe’s user growth has increased 1719.3 percent, while Sudan’s is up 1219.4 percent.
• While Nokia may have struck out again in the U.S. recently, it continues to do well in Africa’s low- to mid-tier handset market: In 6 of the top 10 countries, the top 10 handset lists were comprised solely of Nokia handsets, with the Nokia 5130 XpressMusic routinely being the most popular device.

So what’s causing such explosive mobile web growth across the African continent? That’s difficult to say, although in areas with limited or slow wireless networks, Opera’s mobile browsers can speed up surfing while using less bandwidth. Opera’s report gives a glimpse of another reason: the growing popularity of top-tiered, global web destinations. According to Opera’s data, Facebook, Google and YouTube are all routinely among the top four websites being hit up by handsets in African countries.

That doesn’t mean there isn’t room in Africa for other popular web sites on mobiles though, so if I were a mobile cloud provider or webmaster for some other mobile service, I’d consider packing my bags for a little safari right about now. And on that trip, I’d also be looking to see if any low-priced Google Android handsets could be hunted and bagged or if Nokia will continue to be king of the African jungle.

Image credit: Flickr user Michael Gwyther-Jones.

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Facebook’s new offering for feature phones is an easy example of the reason carriers love apps, and even need them. The GSM Association’s Mobile App Briefing site said Thursday that Dialog in Sri Lanka, Life in the Ukraine, Play in Poland, StarHub in Singapore, STC in Saudi Arabia, Three in Hong Kong, Tunisiana in Tunisia, Viva in the Dominican Republic, and Vodafone in Romania will all offer free data access for the Facebook app for the first 90 days.

For Facebook, this is a plus, as it gets its app freely available and usable on handsets other than smartphones. For the operators, Facebook is one of those killer apps that get people to sign up for data plans. It’s like giving cigarettes to soldiers in their rations — once you have Facebook on your phone, you won’t want to give it up, even if it’s an expensive habit. Now operators can convince more people to sign up for data plans on lower-end phones, expanding the lucrative plans across more of their subscriber base.

The Microsoft example is a bit more complicated for data-loving carriers. Reports had surfaced that Windows Phone 7 handsets were downloading more data than they should, even when the handsets weren’t actively in use. On a PC this isn’t a problem, as most people don’t pay for their broadband by the byte, but on phones, that’s close to what people do when they purchase a set bucket of bytes. For people on the 200 MB AT&T plan for example, every byte counts — much less the 50 GBs one subscriber allegedly saw. Even on a high-end plan, that’s a $15,005 data bill.

From a carrier perspective, issues like this are a pain. Because the operators have little control over which apps that people can download, when pissed off customers complain about unexpected data use, a carrier can either waive the bill, never knowing what the original problem was (or if it will repeat itself) or risk upsetting its customer. This is where apps and the app stores can wreak havoc on mobile operators. One can argue that the restrictive pricing plans play a huge role in this, but that’s a separate story and issue.

Operators need app stores to get people to sign up for lucrative data plans and boost the average revenue per user, especially as the value of voice declines, and many markets approach saturation for basic cell phone service. But the success of apps comes in part because there are so many options out there for consumers, and people can find whatever they want beyond the carrier-walled gardens. This opens the consumer to higher data usage as well as potential risks that ultimately they will call their carrier about, because the carrier is their point of entry into the whole system and owns the customer relationship.

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Part of the update will also include access to Vudu’s 3D library. Vudu announced streaming of 3D movies at CES, and Boxee’s Andrew Kippen was quick to point out that the Boxee Box currently is the only Internet set-top box that allows the rental of 3D movies. To be fair, Vudu also streams 3D movies to Sony’s PS3 as well as a bunch of Blu-ray players, and we’ve been generally skeptical about the future of 3D in the home, but the feature may give Boxee a slight advantage over Roku and the Apple TV with some users.

Update: Boxee just got in touch with us to correct themselves, saying that 3D isn’t actually part of this roll-out. The company says it hopes to have access to 3D movies through Vudu “in the next few weeks.”

Owners of the Boxee Box have been quite vocal about the fact that the device didn’t ship with access to Vudu and Netflix. Today’s launch of the Vudu app could help to pacify some of these users, but the big elephant in the room seems to be the Netflix app, which is still missing. The startup had originally said Netflix would be available by the end of 2010, but more recently said it hopes to deliver the app by the end of January.

Boxee recently teamed up with Iomega and Viewsonic to produce a network attached storage drive as well as a TV set with its media center software included. Still, the long delay of the Vudu and Netflix apps seems to prove that in the age of connected devices, making CE products isn’t just about hardware alliances anymore.

Want to know how to optimize your Boxee Box experience? Then watch the newest episode of Cord Cutters below, or check out our list of 10 Tips for Getting the Most Out of Your Boxee Box.

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The number of people who watch online video on their TV is three times as high as it was just a year ago, according to Sidereel. However, don’t expect to find an Apple TV or a Roku box in every household included in the survey; 60 percent of respondents have simply connected their computers to the TV screen. They’re using this type of setup to watch a whole lot of online video: 54 percent of users watch five to 20 hours of online video per week.

Granted, surveying users of a site dedicated to online video viewing is more than a little self-selective, but Sidereel CEO Roman Arzhintar told me via phone that the average age of his site’s users actually went up from 26 to 29 when compared to December 2009. This could be an indicator that online video viewing is becoming more mainstream, and Netflix clearly plays a role in this as well, as 24 percent of Sidereel’s users are also Netflix subscribers.

However, not all is lost for Hulu, which is trying to compete with Netflix by offering its own Hulu Plus subscription service. Four percent of Sidereel’s users are also Hulu Plus subscribers. That is actually quite impressive, given the fact that Hulu Plus only officially launched in mid-November.

The single biggest loser of this growing trend toward watching online video subscription services on the TV screen could be your plain old pay TV provider; 25 percent of Sidereel’s users don’t have any pay TV at all, and many others could cut the cord soon. The survey showed that people who watch more than 10 hours of online video per week are more likely to also go ahead and ditch or significantly scale back their pay TV subscriptions. “These are people who are not cord cutters today because they still have cable,” Arzhintar told me, adding: “But they don’t watch a lot of it, and it’s expensive.”

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Boxee May Go to Subsidized Deals to Compete With Apple TV. Founder Avner Ronen also says that the $200 Boxee Box was “way too expensive.” (Electronista)

RealPlayer for Android Upgrade Now Available. The new version, available for free, is based entirely on over a thousand pieces of user feedback. (RealNetworks)

iPad: Just Another ‘Free Internet Appliance’? Research shows that iPad users are choosing ad-supported content over pay content. (Paid Content)

Netflix Spends 20 Times More on Postage Than Bandwidth. Netflix COO Ted Sarandos told the Hollywood Reporter that it currently costs Netflix up to $1 per DVD mailed roundtrip. (Digital Society)

For Hollywood, It Was a Tough 2010. Media sales and theater tickets all declined last year. (LA Times)

1. The Steve Work Ethic

Considering the turbulence Apple faced Monday and Tuesday, it’s difficult to imagine that every analyst would choose to not ask questions about the impact Jobs’ medical leave of absence would have on the company, yet none did, at least not directly. However, one question was posed about “long-term planning” about products.

“In my view, Apple’s doing the best work ever,” said COO Tim Cook, adding that the company was “very happy” with the product pipeline, and then he said this:

“The team has an unparalleled breadth and depth of talent and innovation that Steve has driven in the company, and excellence has become a habit, and so we feel very confident about the future of the company.”

Present or not, the influence of Steve Jobs still guides Apple.

2. Apple and the Dragon

When queried about how Apple can manage to sustain the insane growth of the present and the past, the answer that came up repeatedly was Asia, specifically China. The company stated that years ago Apple identified China among emerging as its “top priority” and the results are “absolutely staggering.” China, Hong Kong, and Taiwan generated some $2.6 billion in revenue for the quarter, quadrupling performance over last year. The number of visitors and sales at Chinese Apple Stores exceeded those of every other store, including flagship stores in the U.S. and Europe.

Besides China, sales in Japan were up 83 percent year over year, with strong growth for the Mac: up 56 percent. Korea was also singled out as being very receptive to the iPhone, and Japan was mentioned as well, but clearly, China is the focus of new markets for Apple going forward.

3. The Mac Is Back

Actually, it never left. For a jaw-dropping 19 consecutive quarters, the Mac has grown faster than rest of the PC market. For the most recent quarter, the Mac achieved 23 percent growth, compared to a meager three percent for the rest of the industry. Apple sold more than 850,000 Macs in retail Apple Stores, and once again, for nearly 10 years, “about half” of those purchasing Macs were doing so for the first time.

As to what people were buying, the biggest sellers were the MacBook Pro and the new MacBook Air. Apple executives described the Mac as a “phenomenal” part of their growth. That growth included 2.9 million laptops sold, representing 70 percent of Macs sold during the quarter. Consumers loved new features like “instant on” and the speed of solid-state drives according to Apple. Look for SSDs to migrate to other Mac portables soon, most likely with faster CPUs from Intel.

4. The Unstoppable iPhone

After selling more than 14 million iPhones from July through September, Apple topped that by selling more than 16 million iPhones during the holiday quarter, and they could have sold more. More than six months after launch, the iPhone 4 is still supply-constrained, and Apple executives have no idea when supply and demand equilibrium will be reached.

It almost certainly won’t be this quarter, with the launch of the Verizon iPhone. In fact, a question regarding expanding sales of CDMA iPhones to countries like China was only partially deflected. While Apple is “always looking for opportunities,” it was implied that current iPhone supplies preclude any major expansion in the short term. For the first time, Apple may be looking at an iPhone that sells out across the model year.

5. Other Tablets Still Suck

Trash-talkin’ Steve Jobs may not have been there to put the smackdown on competing tablets, but Tim Cook filled those shoes admirably. According to Cook, competing tablets currently fall into one of three categories:

1. Window tablets that are “big, heavy, expensive, and have poor battery life,”and that require input devices like a stylus. Consumers are simply “not interested.”
2. Android tablets that, by Google’s own admission, run an OS not designed for tablets in sizes that are “less than reasonable,” failing to provide a “real tablet experience.” They are “scaled-up smartphones” and Apple is ”not concerned” about  them. I wouldn’t expect a 7-inch iPad this year.
3. Vapor. That would be tablets previewed at CES or earlier, and possibly the BlackBerry PlayBook, though RIM was never mentioned.

6. 160 Million iOS Devices Sold

To put that number in perspective, the number of iOS devices passed 100 million last June. In September, that number was 120 million, and now it’s 160 million. By the time the next iPhone launches in June or July, it will be at least 200 million, perhaps as many as 250,000 million.

That’s the takeaway from this quarter’s conference call: six facts worth remembering.

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