After searching for several months, Akamai announced on Monday that it has found a new chief executive officer.
The cloud and software provider has named co-founder and chief scientist Dr. Tom Leighton as the new CEO, replacing Paul Sagan, effective January 1, 2013.
Leighton and Sagan will both continue to serve as Akamai directors, with Sagan becoming a senior advisor to the company and working with Leighton on business strategies.
The goal here is to enable a smoother transition at the top, about which analysts seem optimistic.
Jefferies analysts wrote in a memo on Monday that Leighton has been considered "synonymous" with Akamai since it was founded.
Following a lengthy search, the internal appointment suggests the unique attributes that the Board desired—Dr. Leighton's established tenure with not only AKAM but also customers and partners, as well as the depth of AKAM’s broader senior management team. The company will also maintain strategic and operational consistency which will mitigate uncertainties.
Wells Fargo senior analyst Gray Powell concurred, describing the appointment of Leighton as a "modest positive."
Dr. Leighton is well known and respected by the investment community. He co-founded AKAM 14 years ago and has been instrumental in driving innovation at the company. We expect that new product development will be a key focus of the new CEO as AKAM looks beyond it core CDN / site acceleration products for the next leg of growth in cloud infrastructure solutions. Additionally, we think the slew of announcements this morning reflects the deep internal bench strength at Akamai. We maintain our Outperform rating on AKAM.
Stifel Nicolaus also seemed supportive of the Leighton announcement, although analysts wrote "it is also worth noting that Mr. Leighton does not have any experience as a public company CEO, though Mr. Sagan’s decision to remain on as a senior advisor could be helpful on this front."
In April, Akamai originally announced Sagan's intended resignation to take place by the end of this year. Sagan was named president in 1999 and been CEO since 2005.
In a statement, Akamai emphasized under Sagan's leadership, the corporation "surpassed $1 billion dollars in annual revenue, completed numerous strategic acquisitions, and emerged as a leader in Internet performance and cloud infrastructure services."
As for Leighton, before co-founding Akamai in 1998, he was a professor of applied mathematics at MIT as well as a member of MIT's Computer Science and Artificial Intelligence Laborators. He holds a number of patents for content delivery, Internet protocols, and digital rights management, among other areas.
As chief scientist, Leighton was responsible for Akamai's technology vision and strategies as the business grew from a startup to fully-fledged cloud infrastructure services platform.
Akamai has a few other executive appointments and introductions today. Executive vice presidents Robert Hughes and Rick McConnell are being promoted to president of worldwide operations and president of products and development, respectively.
Both of these promotions are also effective on New Year's Day.