backtop


Print 59 comment(s) - last by mehcin.. on Sep 2 at 2:37 PM

Sources say he wanted to stay through some of the restructuring process

While Microsoft CEO Steve Ballmer said retiring was entirely his decision, others say he was pushed to go sooner than expected. 

A new report from All Things D said that interviews with sources close to Ballmer and Microsoft revealed that the retirement was planned, but wasn't supposed to happen so soon. Sources said that Ballmer had hoped to stay through at least some of the restructuring that he was planning. 

In Ballmer's letter of departure, he said: “My original thoughts on timing would have had my retirement happen in the middle of our transformation to a devices and services company focused on empowering customers in the activities they value most.” 

Also, when the restructuring was announced in July, Ballmer said: “Lots of change. But in all of this, many key things remains the same. Our incredible people, our spirit, our commitment, our belief in the transformative power of technology — our Microsoft technology — to make the world a better place for billions of people and millions of businesses around the world. It’s why I come to work inspired every day. It’s why we’ve evolved before, and why we’re evolving now. Because we’re not done. Let’s go.”

In addition, many suspect that Microsoft Chairman and Co-Founder Bill Gates was in favor of moving Ballmer's retirement to a sooner date. While one source said Gates didn't "instigate" it, he wasn't exactly as supportive of Ballmer as usual.

Ballmer's departure letter didn't make any mention of longtime colleague and friend Gates, which sparked a lot of questions. Gates' statement wasn't exactly a heart-warming goodbye either, leading some to believe that Gates didn't stand up for Ballmer -- and maybe even helped push him out the door along with the rest of Microsoft's board. 

Ballmer's attitude even reportedly changed after the retirement announcement. An anonymous source said that Ballmer was jumping into meetings with the same confident attitude as always before the announced retirement, but afterward, he sat uncharacteristically quiet in such meetings. 


Microsoft CEO Steve Ballmer

There are a few reasons why Ballmer would be pushed out early. For starters, Microsoft is facing an ugly proxy fight with investor ValueAct, which has a large stake in Microsoft and is looking to grab a seat on the company's board. Microsoft is trying to prevent this, but ValueAct has made some demands: Ballmer's retirement, stock buyback and a dividend increase. 

Aside from this sort of pressure, Ballmer also faces criticism for decreased performance. Microsoft has had a difficult time stirring up enthusiasm for Windows Phone against competitors like Apple and Samsung, and the Windows maker was late to the tablet game -- releasing its Surface tablet in October 2012 after the iPad had already been out for over two years. To make matters worse, Microsoft's Surface was initially released with the Windows RT operating system (the full Windows 8 Pro-powered Surface wasn't released until February 2013) and it was a major flop. Many say RT isn't a full Windows 8 experience, lacking the ability to run legacy apps.

Windows 8 hasn't exactly had the best reception either, with many complaining that the operating system and its completely revamped Metro UI with live tiles is a better mobile OS rather than desktop. Many want the old desktop and Start menu seen in Windows 7 and previous. 

Microsoft also slipped up recently with its Xbox One announcement. The new console, which is expected to be released this fall, initially had a used games ban and a new "always-on" digital rights management (DRM) system, which posed a problem for many people who are either in rural areas with slow Internet connections, travelling or tend to experience Internet issues with providers. Microsoft later retracted these features after major complaints, but the fiasco still didn't sit well with gamers.

All Things D added some figures that surely hurt Ballmer's case. The day before Ballmer took over as CEO in 1999, Microsoft’s market capitalization was $600 billion USD. On the day before he announced his retirement, it was under $270 billion USD.

Pushing Ballmer out was likely a decision to meet ValueAct's demands, boost Microsoft's performance and give the company a new leader through the restructuring process. It just seems Ballmer wasn't entirely in on that plan -- at least not this soon. 

Source: All Things D



Comments     Threshold


This article is over a month old, voting and posting comments is disabled

Market capitalization criticism is sort of unfair
By Nagorak on 8/26/2013 10:52:19 AM , Rating: 2
While Balmer may not have been a great CEO, holding it against him that the market cap decreased from $600B to $270B isn't completely fair. That market cap was incredibly inflated by the tech bubble. At the time tech stocks were trading at outrageous multiples-- above 100 times earnings!-- and even dot bombs that were never profitable (and later went to zero) were trading at insane prices.

Numerous tech companies are still below the prices they set in 1999. In fact, you're actually hard pressed to find tech companies that are not below their '99 price, even among those which have done well in the last decade (Qualcomm). Apple is one of the few that hasn't followed this trend, due to their explosive growth post iPod.

In any case, the starting point of Balmer's tenure was obviously a vastly inflated price, although that doesn't mean the company/stock couldn't have done better in recent years.




By retrospooty on 8/26/2013 10:54:29 AM , Rating: 2
I agree market cap isnt a fair hit on him, but missing the consumer/mobile boat is... Had they executed well, this conversation wouldnt even be happening as the stock price would likely be in the stratosphere like Google and Apple... ANd all we would have to say about Ballmer is more "Sweaty Ape" jokes ;)


By Motoman on 8/26/2013 11:21:41 AM , Rating: 3
It's very reminiscent of when MS was convinced that the internet was not really going to be a thing, and that there was no point in investing in it.


By Captain Awesome on 8/27/2013 7:58:50 AM , Rating: 2
Well they were right, the internet is just a fad.


By Mitch101 on 8/26/2013 11:28:55 AM , Rating: 2
Rupert Murdoch believes Hedge Funds are partly responsible.

In a way he gave himself a parting gift.

Microsoft Stock Surges Up 7%; Ballmer $769 Million Richer
http://microsoft-news.com/microsoft-stock-surges-7...

After Ballmer disclosed his retirement plans, Microsoft’s share price rose some seven percent, pushing the value of Ballmer’s stake to $11.563 billion, and making him $769 million in the process.


By Scrogneugneu on 8/26/2013 9:45:12 PM , Rating: 2
Gotta love that feeling.

When you announce you're going out, the stock price skyrockets. On the flip side, you get 3 quarters of a billion in your pockets.

I wonder how well you sleep that night.


By Helbore on 8/27/2013 8:34:22 AM , Rating: 2
If I could announce that I was retiring and get $700 billion in the process, I'd sleep VERY well!

No more work and enough money to live like a king for the rest of your life. What's not to like?


By Helbore on 8/27/2013 12:14:26 PM , Rating: 2
$700 million, even! I'd definitely have no trouble sleeping after earning $700 BILLION!


"We’re Apple. We don’t wear suits. We don’t even own suits." -- Apple CEO Steve Jobs














botimage
Copyright 2014 DailyTech LLC. - RSS Feed | Advertise | About Us | Ethics | FAQ | Terms, Conditions & Privacy Information | Kristopher Kubicki