Thursday, June 15, 2006

Ummm... could I have what's behind door #2 instead?

Okay, I'll admit it, if there was going to be a senior leadership change, this isn't the one I would have opted for first. I feel a bit like the guy on Let's Make a Deal who just got the elephant instead of the trip to Europe. Wall Street seems to have been thinking the same way since the stock was up on the rumor but down on the news. If you somehow missed it, Gates announced today that he'll be stepping down from his current full-time role at MSFT effective July of 2008 to focus on his charitable foundation. He will continue on as Chairman. You can listen to the webcast or read the press release here.

In the webcast, Gates made it very clear that he has 100% confidence in Ballmer as CEO. In his words, Ballmer has done a:
...fantastic job on every measure.

On every measure Bill? What about the only one that ultimately matters to shareholders - the stock price? Comments like this are unfortunate because they reinforce the perception of a management team that doesn't place any importance on the stock. A reporter did ask Ballmer about the apparent "disconnect" between results and share price in the Q&A that followed - judge for yourself if you find the answer compelling.

On a brighter note, I'm encouraged to see Ray Ozzie take over the role of chief software architect. Ray seems to have a good handle on where computing is going and what MSFT needs to do to successfully manage the transition. His elevated role may also keep him from succumbing to the 2-3 year maximum career expectancy that has typified most other senior-level transplants to Redmond.

Various media reactions:


  • It seems like all of the major announcements over the past year have been both positive and negative.

    Everything at Microsoft feels this way. Ray Ozzie is great... He's got the engineering team's respect, and he has more of a finger on the pulse of the Valley than some of the execs that live in a Redmond bubble.

    BUT, this news clearly means Ballmer is no where near stepping down. Even if he does have ideas that could turn the company around, we've lost confidence in him, especially after the Business Week interview last year which showed how completely out of touch he was. He needs to step down, however symbolic the gesture, and make way for Microsoft 3.0.

    By Anonymous msft_3_dot_0, at 5:49 PM  

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