He'll be remembered as a terrible CEO. Ballmer took over as CEO in 2000. In the 13 years since then, Apple has experienced an unprecedented resurgence. Google and Facebook have gone from being obscure startups to giants. The tech industry went through the bubble, recovered, and today is stronger than ever.<p>What happened to Microsoft? While the rest of the tech sector exploded and prospered, it stayed still. A MSFT share was worth about $35 dollars when Ballmer took over; it's worth about $35 now. The world moved on, and Microsoft didn't move with it.
Huge news! Let's see what happens to the stock today. It edged up a little at the end of the day, suggesting that perhaps news was getting out. It's up 8% in premarket trading. [1]<p>One interesting thing to note from that chart is their Beta (a measure of link to market volatility) is less than 1, which is very low for a high tech stock. It basically means that the market views them as less volatile to market conditions than an index fund. Or put another way, more like a utility than a high tech firm.<p>What does this mean for Microsoft? I think an awful lot will depend on his replacement. I don't think they can get Gates to do another round. Who has the breadth of skills to manage it all? Seems like a complex enough beast that finding an appropriate outsider would be difficult too.<p>Going to another source [2] I see:<p>“As a member of the succession planning committee, I’ll work closely with the other members of the board to identify a great new CEO,” said Gates. “We’re fortunate to have Steve in his role until the new CEO assumes these duties.”<p>This suggests that he could be gone much sooner if the search goes well. These things don't happen overnight, but it could be by the end of the year or even sooner.<p>[1] <a href="http://finance.yahoo.com/q;_ylt=AsQ2vnc2OVs8WNqk.WdDwM.iuYdG;_ylu=X3oDMTBwdm1qNzVjBHNlYwNVSCAzIERlc2t0b3AgU2VhcmNoIDI-;_ylg=X3oDMTBucmRhZWhqBGxhbmcDZW4tVVMEcHQDcG1oBHRlc3QD;_ylv=3?uhb=uhb2&fr=yfinanceheader_test2&type=2button&s=msft" rel="nofollow">http://finance.yahoo.com/q;_ylt=AsQ2vnc2OVs8WNqk.WdDwM.iuYdG...</a><p>[2] <a href="http://blogs.wsj.com/moneybeat/2013/08/23/microsoft-ceo-steve-ballmer-to-retire-in-12-months/" rel="nofollow">http://blogs.wsj.com/moneybeat/2013/08/23/microsoft-ceo-stev...</a>
I think Ballmer is an interesting case study in perception versus results. He's commonly portrayed as a poor CEO that has led Microsoft in the direction of irrelevance. And yet, to quote oft critic Gruber, "he knows how to make money" (<a href="http://daringfireball.net/linked/2013/04/19/msft-q3" rel="nofollow">http://daringfireball.net/linked/2013/04/19/msft-q3</a>)<p>I'd love to sit down and talk to him, and see if his vision is a bit more long range than your average industry analyst, similar Paul O'Neill's vision on worker safety and Alcoa in 1987.
<p><pre><code> +------------------------------------+
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| Microsoft has encountered an error |
| and Wall Street is not responding. |
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| If you choose to retire the CEO |
| immediately, you will lose any |
| unsaved cash cows and reboot the |
| corporate strategy. |
| |
| [ Retire ] [ Cancel ] |
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+------------------------------------+</code></pre>
Paul Thurrot's comment:<p>"On a personal note, I'll just add that Ballmer was one of the good guys. Though he was relentlessly mocked for his over-the-top public appearances in years past, Ballmer was also relentlessly pro-Microsoft and it's very clear that the troubles of the past decade were at least in part not of his making: Ballmer inherited a Microsoft that had been driven into an antitrust quagmire by Mr. Gates, handicapping its ability to compete effectively or respond to new trends quickly. While many called for his ouster for many years, I never saw a single leader emerge at Microsoft who could fill his shoes or the needs of this lofty position. Looking at the available options today, I still don't."
Since the Bill and Melinda Gates Foundation has a huge percentage of its wealth still in MSFT stock, I think Bill Gates can make a case to himself that picking the best possible leader for MSFT will save hundreds of thousands of marginal children.<p>If I were him, there would be two candidates: Qi Lu (insider, obvious choice), or, for the ultimate in turnaround ballerdom: Ben Horowitz (from a16z). Either would be a vast improvement on Ballmer, but Qi Lu would be the "safe" choice, mostly doubling down on trends within Microsoft. Ben Horowitz would put Microsoft solidly at the core of Silicon Valley, plus it would signify that Microsoft views the next 10 years as "wartime" with a CEO to match.<p>(The other low-odds pick would be Bill Gates Round 2, but that seems unlikely just due to where he is in life. I could maybe see it as "Interim CEO". He'd do an awesome job I'm sure.)
Let me tell you an anecdote why I think Ballmer was incompetent and largely responsible for the sorry state that Microsoft is in at the moment. Yesterday there was a long article in the Israeli newspaper Globes about the success of the Israeli adware companies. Israel has in recent years become a world leader in software that installs unwanted toolbars on your elderly dad and mom's PC and "monetizes" them until they get their son or daughter to come over and fix it.<p>The list of such companies includes some really big ones, like Babylon and Conduit. These companies are making their profits by degrading Windows users' experience. Not only didn't Ballmer do anything to fight them, Microsoft actually has affiliate agreements with these companies to take a slice of the profits. Screwing your own customers like that cannot end well for Microsoft.
As someone who spent five years working at MSFT under Steve as CEO, my first reaction is sadness. Steve spent over three decades working there, it is an end of an exceptional career, regardless of how his run as CEO might have been.
I'm most interested with the "type" of CEO they replace him with. Broad categories:<p>- Within Tech: They hire an Apple type key executive whose background is all around getting hardware/software/direct sales to work together. They want to move to be a super tight, integrated brand.
- Outside of Tech: They hire from a GE type of company. This acknowledges that they're a sprawling behemoth and will stay that way. They need someone who can manage a hugely disparate conglomerate.
- Tech vs Sales: Broadly speaking Bill was a product guru with a huge slice of business acumen. Ballmer was all sales and number driven. How we describe the new hire will be interesting.
- Mobile vs Cloud. Do we end up with someone really well known for their mobile background? Or someone who is really well thought of for understanding the cloud? For example Apple has generally nailed mobile and struggled in cloud. MSFT has actually done a little better in cloud than they're given credit for. But it will tell us what they think is more important by the hire.<p>Any other suggestions?
People here will argue that he is the worst CEO ever, that's debatable of-course. But I want to say some good things about him. To me he is a guy in a suit who understood software development. He shouted (in)famous "developers, developers, developers"[1], he knew that LOC is not a good measurement of software development[2], he poured loads of money in MSR ignoring the pressure of shareholders. For these reasons only he is a fine guy in my book. So I thank him for his works in Microsoft.<p>[1] <a href="http://www.youtube.com/watch?v=8To-6VIJZRE" rel="nofollow">http://www.youtube.com/watch?v=8To-6VIJZRE</a><p>[2] <a href="http://www.youtube.com/watch?v=PWylb_5IOw0&feature=player_detailpage#t=2338" rel="nofollow">http://www.youtube.com/watch?v=PWylb_5IOw0&feature=player_de...</a> (go to 38:59 time mark)
Wow, this is going to be the best thing for MSFT stock (and probably the company) in the past 10 years. I'm excited about having a real force to counterbalance Google, Apple, Facebook, Amazon again.<p>This, and the other company response to it, might be good for +0.05% GDP growth or something crazy like that.
Funny thing that people tend to prefer Gates' version of Microsoft ( which is full of popular but sub-quality products) rather than Ballmer's version ( with unpopular but more stable products)
I feel bad for ballmer. his legacy is going to be pretty terrible because the stock price was flat from when he took over until now. nobody seems to take into account that he took over in the middle of the tech bubble bursting and msft was hugely overvalued at the time. I think profit has tripled since he took over or something like that. following gates was already going to be one of the hardest tasks possible. getting handed an overvalued company in the middle of a bubble bursting makes it all but impossible.<p>while i don't actually think he was a good ceo, i think he is much better than he gets credit for. they say he missed mobile, but i think windows phone is pretty good and new take on it. it was just a year or 2 late. xbox has been pretty fantastic overall. windows 7 was good. i think windows 8 has potential. azure is pretty good as far as i can tell. sure vista sucked (though not as badly as everyone says), and there have been other failures (kin anyone?).<p>People act like other good ceo's don't ever fail. Jobs had plenty of failures. Ping, mobile me, etc... Jobs had the "benefit" of taking over an almost dead company. making it thrive meant stock went crazy and he gets to be awesome. Ballmer just got in on the wrong end of the market. Tim Cook might have this problem as well, but at least Apple wasn't wildly overvalued at the time.
Steve Ballmer is the perfect example of why a business person should not run a software company. The opinion that "Steve knows how to make money" is a poor indicator of a successful leader. Microsoft has alienated developers leaving only enterprise developers to create boring interfaces for users causing many personal computer users to find something more aesthetically pleasing (OSX/Ubuntu). A company based solely on making money is like a marriage based solely around sex and benefit to social-status. If you're a .NET developer and this offended you; good. Money != happiness
Scott Guthrie for CEO!!!!
<a href="http://en.wikipedia.org/wiki/Scott_Guthrie" rel="nofollow">http://en.wikipedia.org/wiki/Scott_Guthrie</a>
It must really hurt the self-esteem of a CEO when they announce retirement and the stock goes up.<p>That being said, it's about time. Microsoft has had too much misdirection lately and really needs to either pull it together or drop out of some of its markets.
Good news, this really had to happen. One of Microsoft's biggest problems is one of PR - too many people, particularly in the media have just hated Microsoft for years, and Ballmer is not charismatic enough to ever recover from that position. They need new blood, and to shake off the "old Microsoft" image if they want to win hearts and minds again.
$24 billion. That's the increase in market value as of 15 minutes before the open. This has to be a record for a CEO announcing he's leaving. I've always wondered how much these types of things bruise the egos of the retiring execs.
'It'll be better without Ballmer' is the 'If Jobs were alive' of the Microsoft world. I don't necessarily think that Microsoft has been doing a swell job, but I didn't think they were when Gates was in charge. Mostly it's a disappointment that they're <i>that</i> big and doing <i>that</i> little progressive.<p>Still, he's not been an awful CEO, business has been good under Ballmer but progression has been awful.
Good news, bad news, who knows?<p>I don't know if current Microsoft issues are in their DNA or not. Personally I was bullish (yes I put my money where my mouth is) of MSFT but I mainly found the following obstacles to be more optimistic:<p>- The relationship with developers was deteriorating: I am a MSDN customer and tried to upgrade but they don't give me any discount in the first year of upgrade while keeping with my same subscription level I have discounts. In our company we also have issues with getting new keys (or using the existing ones) for their software and we need to talk to someone personally to receive them.<p>- Windows 8 / Office are in the middle of a transition but not there: I think having a hybrid mobile/desktop OS is a good idea. But I don't like to use my desktop in the way I use a mobile device (i.e: the famous start button) or the reverse. If they want to go mobile they must implement an Office that can be used with a new UI.<p>- The Microsoft web offerings like Microsoft 365 are slow, difficult to configure, buggy. If they just copy Google/Apple style they would benefit a lot.<p>Disclaimer: I love Visual Studio and C#.
Now the question is, whoever will be next at the helm, will he / she be able to reverse directions and steer Microsoft into more relevant and fruitful territories.<p>Ballmer's Microsoft was always late to the party, overseeing important technology trends and society transformations out of, I'd call it a mix of ignorance and arrogance; maybe they were also too blended by their previous successes. The way he dismissed iPhones, iPads, the way they developed their OS. Or the Zune, or Bing, there has been much criticism over the years. I don't know which moves would have been better (except for seeing the mobile future and the suckyness that was Windows Mobile 6 in time), but Ballmer was always more of a numbers guy I hear, and less of a visionary. I hope their next big guy is going to have more vision.<p>This may be a good day to buy their stock, if you like 50/50 games.
Long, long overdue. He should've been fired (<i>ahem</i> - retired) after the Vista failure, which was <i>his</i> failure. It took Sinofsky to turn things around with Windows 7, and deliver on time.<p>Hopefully this means a lot less "Metro" in Windows 9.
The question really is: who is the best to run Microsoft?<p>Its a hard choice: too much enterprise for anyone at Google, have to talk to folks outside of Microsoft (partners, enterprise) so that rules out anyone at Apple. So who then?
> Steve Ballmer joined Microsoft on June 11, 1980, and became Microsoft's 30th employee, the first business manager hired by Gates.<p>> Ballmer was initially offered a salary of $50,000 as well as a percentage of ownership of the company. When Microsoft was incorporated in 1981, Ballmer owned 8 percent of the company. In 2003, Ballmer sold 8.3% of his shareholdings, leaving him with a 4% stake in the company<p>Wow. How common is it for such a late employee to have so much percentage of a company?
Stock immediately went up 7% on the news.<p><a href="http://www.google.com/finance?q=NASDAQ%3AMSFT" rel="nofollow">http://www.google.com/finance?q=NASDAQ%3AMSFT</a>
It will be interesting to see if Microsoft follows a Yahoo like trajectory - and if Apple follows Microsoft's trajectory after a few years of Tim Cook.
Anyone else thinking Bill Gates might be "chosen" to be the next CEO of Microsoft?<p>It might sound ridiculous but he's been involved with his foundation work now for several years so it should be running well. He could probably leave the foundation to others to run now. So, he could return to Microsoft to try to lead it's resurgence. It's a challenge I wonder if he's up for.
I think the main problem with it's leadership is that Microsoft lost it's innovative spirit. I think the main reason for that is that Ballmer is a business and marketing guy, and not a tech guy.
All the giants today are led by tech people and that's effect the entire culture of all the company.
Microsoft isn't going in the opposite direction that it should be going on. Instead of integrating more, it needs to make more software for Android and iOS. If it weren't tying everything into Windows all the time Office and other Microsoft software would be dominating App Store and Google Play, ensuring its success for the next generation.<p>Instead it's tying everything back into Windows and Windows phone. Those things should stand on their own feet. Microsoft can create great versions of its software for all platforms, but instead it handicaps itself to no great effect. Limiting Office to just its own platform hasn't really made much of an impact.
Some people are claiming Balmer deserves some credit for keeping Microsoft profitable/status quo, but it seems like they're forgetting the stranglehold Gates had on computing when he left. It's not hard to keep the gravy train flowing. This is part of Balmer's problem, is that Microsoft thought it could stay current by essentially continuing its model of releasing new, sleeker versions of the same software every few years, ignoring that the fundamental way in which we interact with computers has changed drastically over the part decade. By the time they do innovate, they're too far behind to matter.
In honor of this news: developers, developers, developers, developers...in techno.<p><a href="http://www.youtube.com/watch?v=t6ZarKIKpSA" rel="nofollow">http://www.youtube.com/watch?v=t6ZarKIKpSA</a>
Ironically, their CEO search process reflects the bureaucratic nightmare that is today's MSFT. Why not just park Gates in an office and interview the 10 best MSFT senior execs?
Terrible CEO or not. Under his leadership Microsoft stopped becoming a software leader. They stopped leading and started following. Yes. Great products were launched. Windows Phone 8 (really cool interface), the Surface tablet, the xBox, Azure, various improvements to Bing. But they were outdone by competitors in almost all of these areas. Microsoft has to keep innovating, they have to become the disruptors. Right now, they're just busy playing catchup.
If you think about it, what does the "within 12 months" part even mean? Like, if the deadline hits, they'll just take whoever they can get?
Ballmer's Microsoft really did have some intensely great research and development going under the hood, but the management was completely unacceptable for such a large company. There needed to be individual units so each team could work at their best, but unfortunately, the piss-poor management that Ballmer headed didn't allow this, and resulted in the up-down nature of Microsoft's product releases.
Help!<p>On the off chance anyone at Microsoft reads this, my Microsoft account got deleted by a bug in Live Domains and I haven't been able to successfully contact anyone to report it or fix it. The forums have been useless and now I can't do anything MS related without my account including my phone!<p>My e-mail is in my profile.<p>(Apologies for posting this as I know it doesn't add to the discussion but I have no idea how else to contact an MS engineer.)
Microsoft successfully won the battle of the desktop computer. It's amazing how this monument of achievement actually gave Microsoft a long-term disadvantage as desktop computing slowly became irrelevant to laptops and mobile. Failing now promotes success in the future. It will be interesting to see what happens over the next 10 years, especially with DIY and web dev on the rise.
My biggest hope from all of this would be for Microsoft to enhance its current products. They have been trying to get into too many fields while at the same time forgetting to make their main priority products perfect.<p>Considering the rising impact Linux has been having over the past few years, I'd only be glad to see Microsoft try to come up with a superior operating system.
About time. I hope that he picks someone that can take MSFT from the boring and problematic company that we have no choice but to deal with, to a company that is producing products that actually make it easier to use things and more powerful (Windows 8 was a huge step back).<p>They need someone who will innovate and continue to innovate.
I know the stock price isn't everything, but this is quite telling about Ballmer's reign: <a href="http://tinyurl.com/ballmerballmer" rel="nofollow">http://tinyurl.com/ballmerballmer</a><p>I didn't include AAPL, because that would have destroyed the others. And GOOG wasn't around in 2000.
Microsoft <i>stifled</i> innovation. For a twenty year period, they held market dominance and used their monopoly power to maintain the status quo. They did a huge disservice to our entire industry. I say good riddance to bad rubbish.
Just after piracy hit all time lows. Good timing really.<p><a href="http://fakevalley.com/microsoft-pirated-software-sales-also-at-all-time-low/" rel="nofollow">http://fakevalley.com/microsoft-pirated-software-sales-also-...</a>
i wonder if his last day will be as awesome as this: <a href="http://www.youtube.com/watch?v=i1M-IafCor4" rel="nofollow">http://www.youtube.com/watch?v=i1M-IafCor4</a>
As of right now the stock is up 6.5% upon the announcement of Balmers departure, that certainly can't feel good. (Other tech stocks appear to be down or holding level today)
I wonder what is bill gates thinking or planning now. Or what happened between him and ballmer from his nomination.<p>Just looked after the reasons Bill Gates Stepped down, could not find a lot
He is suffering from <a href="https://en.wikipedia.org/wiki/Peter_Principle" rel="nofollow">https://en.wikipedia.org/wiki/Peter_Principle</a>
They got awesome ideas but a really awful implementation of them - Tablet PC and Pocket PC devices/mobile phone (MDA anybody?) are two examples...
Well, Mr. Apotheker, formerly SAP, formerly HP is available.<p>He could give away the XBox, windows and office for free and migrate Microsoft more to enterprise software.
$500 for a phone????<p><a href="http://www.youtube.com/watch?v=eywi0h_Y5_U" rel="nofollow">http://www.youtube.com/watch?v=eywi0h_Y5_U</a>
Nice. Microsoft does some really awesome research work and can easily come out to position themselves as <i>leading</i> the tech space again. Though some would argue they already do, but that's not correct looking at the growth other companies have demonstrated.<p>MS has had some massive misses, a couple of super bungled opportunities in the past decade only because of the ageing 'bored' (pun intended) that thought marketing is the only thing to drive innovation. I hope they find a replacement that's good and that his/her selection is not <i>too much influenced</i> by the existing board or its psyche.
Hmm , so who will be the new boss ? I think it should have been Sinofsky. He delivered W7 which the best Windows ever period ( and i'm a linux fanboy ). W8 was not that great but i dont think he designed that whole Metro fiasco, Metro came from the top. Anyway good luck MSFT.
I don't have a resume that could even begin to get a second look for CEO for a company this size, but boy oh boy would i love to take this position. CEO of Microsoft or CEO of HP is something i'd absolutely love to do! Two companies I think i could really fix - as I'm sure could a million others, but just in case the recruiting firm is reading this and have decided to try a novel approach and try someone with no former Fortune 500 CEO experience. You never know. lol.