Steve Ballmer Takes Charge

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Steve Ballmer Takes Charge
With change of guard at Microsoft, all eyes are on it and expectations are high.

In what can be termed as one of the most surprising announcements to come from Redmond, headquarters of the US-based Microsoft in recent times, its co-founder Bill Gates stepped down as CEO handing over the reins to his immediate subordinate Steve
Ballmer. “I will spend 100% of my time on new technologies,” remarked Gates at a live press conference at Microsoft Studios. While continuing to be the chairman of the company, the world’s richest man, crowned himself with a new title, “chief software architect.” In his new role, Gates, 44 plans to map the company’s vision for the internet age and dedicate himself full-time to what he calls his first passion-building software. 

Gates remarked that his “commitment to working full time” for the company remains 100% but it was time for the management structure to evolve. He said that his new job will involve mostly strategizing. He also plans to increase his use of Microsoft’s development tools to evolve new ways of making them easier to use. He even joked that he may “threaten” to get back into writing code for the company. When asked if it was difficult to give up control of the company, he has overseen for so many years, Gates acknowledged a certain sense of nostalgia. But he was quick to add that he was ready for change. 

The new CEO
As for Ballmer, those within the company and throughout the industry believe that Microsoft’s enemies will find in him an equally formidable adversary. During a press conference held recently at the company’s headquarters, the new CEO clarified that the government has no business breaking up his company. “I think it would be absolutely reckless and irresponsible for anyone to try and break up his company,” Ballmer said. “I think it would be unprecedented and the single greatest disservice that anybody could do to consumers in this country-it would be reckless beyond belief.” In addition to his CEO duties, Ballmer has also become a member of the Microsoft board of directors. 

The change has drawn rather mixed signals from various quarters. Considering the size and status of the company, initial reactions to the news appeared muted on Wall Street. Though the announcement came after the markets had closed for the day, the company’s shares did not witness any drastic change in the after-hours trading. The company’s stock accounts for about 11% of the entire value of the Nasdaq market. Although the timing of the announcement may have been unexpected, Wall Street was not shocked by the decision, analysts said. “I do not think there will be any fundamental change to the company,” said Paul
Dravis, an analyst with Bank of America Securities. “I think it is a good move and not totally surprising,” said William
Epifanio, a JP Morgan Securities analyst, adding that the change may have already been factored into Microsoft’s share price. 

Microsoft’s challenges
The change of guard has come at a time when the company is facing one of its toughest times. The Department of Justice has proposed a breakup of Microsoft to resolve the anti-trust case pending against the company. The company’s dominance in PC software too is being challenged by operating systems such as Linux as well as by inexpensive internet appliances and handheld computers. Its office software, a long-time market leader must now fight for dominance in the new world of web-hosted software offered by application service providers.

Moreover, the battle in the computing world has turned to connectivity and Microsoft faces a formidable foe in AOL especially after its acquisition of Time Warner. By enlisting Time Warner’s vast arsenal of assets, AOL has made a frontal assault on Microsoft’s ambition to become a major content player.

Analysts believe the move may further weaken Microsoft’s already wavering commitment to content and hasten the company’s return to its software roots. The company has also seen defections of some highly placed executives, the most recent being the defection of CFO Greg
Maffei. 

Then the new CEO surely has a daunting task at hand. There are a whole lot of issues calling immediate attention-ensuring there are no further slips in the delivery of long-delayed Windows 2000, upgradation of Windows NT operating system, finding a new chief for the company’s online businesses, making Microsoft technology more compatible for ecommerce tasks and a booming market in which Microsoft is through to trail. But then as Rob
Endrele, an analyst with Giga Information Group, remarks, “Ballmer is just the right guy for the job. He has got the right mindset, the right motivation.” 

Manisha Singh 
in New Delhi

 

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