A year after former senior sales executive Sheryl Sandberg left Google to join Facebook as CEO, Time Warner's AOL has snagged Google's Tim Armstrong as chairman and CEO. That makes it another senior Google executive leaving the search leader to take up a senior management position in another company.

Google Senior Vice President Tim Armstrong will take over as chairman and CEO, replacing Randy Falco, said Time Warner, AOL's parent company. Ron Grant, AOL's president and chief operating officer, will leave with Falco after a transitional period of a few weeks.

The hire was a welcome surprise to Wall Street analysts, who see Armstrong as a respected executive who had overseen Google's American operations. He is best known for his work in developing Google's online advertising business and was widely touted last year as a CEO candidate for Yahoo Inc before the company tapped Autodesk's Carol Bartz. (See: Yahoo has new CEO, Carol Bartz)

"Tim is the right executive to move AOL into the next phase of its evolution. He'll also be helpful in helping Time Warner determine the optimal structure for AOL," Time Warner CEO Jeffrey Bewkes said in a statement. "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."

"Since arriving at Google eight and a half years ago, Tim Armstrong has been a critical force in Google's advertiser-facing operations," Google CEO Eric Schmidt said in a statement.

"We're very sad to see him go, but would like to take this opportunity to wish Tim every success and good fortune in this new role at AOL - one of Google's longest-standing partners. He's one of the most creative, fun and respected leaders in the ad industry, and we have all loved working with him at Google. We'll announce an internal candidate as Tim's successor in the coming weeks and are delighted Tim will remain with Google for the next month to help oversee this transition."

Bewkes and Falco previously split AOL into two broad units, with one focused on audience and advertising, the other on a shrinking legacy dial-up internet access business. Investors had welcomed the strategy and it showed initial signs of growth, but that has slowed in the last year along with the wider advertising slump.

AOL has blamed falling ad revenue for its declining fortunes; its annual revenue fell 20 percent in 2008, to $4.2 billion. Falco's ouster comes as the company is in the midst of a round of layoffs in which it expects to shed about 10 per cent of its workforce, or 700 workers. Falco announced the layoffs in a memo distributed to AOL employees in January. (See: AOL to lay off 700 staff)

Bewkes has publicly said he is looking for the best way to resolve the future of AOL at Time Warner, including either a spin-off or merger with a partner such as Yahoo or Microsoft Corp's MSN. Time Warner has held talks with Yahoo in particular about Yahoo combining with AOL's audience and advertising business.

The timing of the appointment showed Time Warner's determination to speed up its move to become a pure content company, dropping distribution businesses to focus on media brands like CNN, HBO and Warner Bros.

Armstrong, who started with Google in 2000, was a member of Google's Operating Committee and served as the president of the Americas Operations. He is best known for developing Google's online advertising business.

Armstrong is also on the board of the Interactive Advertising Bureau and a trustee of his alma mater, Connecticut College. In addition, he's backing a local-news startup, Patch Media, through his Polar Capital Group private investment company.

Prior to Google, which he joined in 2000,  Armstrong ran sales and strategic partnerships at Snowball.com, now IGN, an entertainment network that's owned by News Corp.'s Fox Interactive Media. Before that, he worked at Disney's ESPN and ABC, as well as Starwave, a company started by Microsoft co-founder Paul Allen.