In quite a surprise move, Microsoft has announced that its CEO Steve Ballmer has decided to retire within the next 12 months. Ballmer had taken over as Microsoft CEO from co-founder Bill Gates in 2000 and has been with the company since its inception.
While the company hasn’t announced any successor yet, it plans to choose a successor in the next 12 months, for which it has appointed a special committee headed by John Thompson and has members like Board Chairman Bill Gates, Audit Committee chairman Chuck Noski and Compensation Committee chairman Steve Luczo.
What’s surprising here is not that Ballmer is quitting, but the rather long transition period. Microsoft might be looking to ensure that there is continuity, over a longer period of time, but 12 months is unusually long. This is especially true when Microsoft recently underwent a major restructuring dubbed as ‘One Microsoft‘, through which all company divisions (Windows, Windows Phone, Xbox and others) were expected to collaborate together to deliver better products to consumers.
In a memo to Microsoft employees, Ballmer however said – “There is never a perfect time for this type of transition, but now is the right time”. He also added that the original timing for this announcement was somewhere in the middle of Microsoft’s transformation to a devices and services company but they needed “a CEO who will be here longer term for this new direction”.
This announcement led to a 7% surge in Microsoft’s share price, increasing the company’s value by $18 billion as indicated by a TechCrunch report, and Ballmer’s own net value by $769 million as pointed out by AllThingsD.
What They’re Saying
Who Will Be The New CEO? Mary Jo Foley of ZDNet believes that Microsoft’s Executive Vice President Tony Bates is a very strong contender for the CEO position. Tom Warren of The Verge also mentions Bates and Executive VP Satya Nadella as the probable candidates, although he notes that without any immediate name mentioned, Microsoft could also be looking for an external CEO and among the potential candidates include Netflix CEO Reed Hastings and the re-entry of Nokia CEO Stephen Elop.
AllThingsD: “Steve Ballmer’s departure was more sudden and was neither planned nor as smooth as portrayed by the company. Ballmer’s timeline was moved up significantly – initially by him and then a nine-member company board”. A separate AllThingsD report also points that while the company’s value went up following the announcement, Microsoft’s market capitalization was $600 billion on the day Ballmer took over as the CEO while it was less than $270 billion on the day he announced the resignation.
Box CEO Aaron Levie via TechCrunch: “Steve Ballmer’s retirement puts an end to one of the most powerful and interesting “regimes” in technology history. Microsoft more than tripled its annual revenue under Ballmer from $22 billion to $78 billion”. “Microsoft needs to recognize that the world has become far more heterogeneous and choice-driven than ever and it needs to adapt its strategy accordingly”.
The New York Times: David Pogue says that Ballmer completely missed the importance of the touch-screen phone and tablets and the products came years too late. He said – “Ballmer and his team lacked the courage to break completely with the increasingly complex, bloated desktop version of Windows and so they created Windows 8 simply by grafting TileWorld onto the old desktop Windows. The result is exactly twice as complicated as before, because now you have twice as much to learn.”
(Any other interesting comments on Steve Ballmer resignation? Let us know)
Tweets About Steve Ballmer’s Resignation
Mainstream support for Steve Ballmer ended in 2009. Extended support ends in 2014.
— Ed Bott (@edbott) August 23, 2013
Job description for new Microsoft CEO: 1. Fix mobile problems 2. Fix software problems 3. Read The Innovator’s Dilemma
— Aaron Levie (@levie) August 23, 2013
— MattRosoff (@MattRosoff) August 23, 2013
Isn’t it amazing that Ballmer is “retiring” just over a month after he finished an ambitious and long-term reorganization? — Javed Anwer (@Javed_Del) August 23, 2013
Retirement. Retirement. Retirement. Retirement. Retirement. Retirement. Retirement. Retirement. Retirement. Retirement. Retirement. — Brad @ FullContact (@BradMcCarty) August 23, 2013
The only real question is whether Ballmer chose to retire or was asked to retire.
— nilay patel (@reckless) August 23, 2013
Why not “retire” immediately? Can’t even leave properly.
— Marco Arment (@marcoarment) August 23, 2013
With Ballmer retiring, speculation will be whether MSFT worth more broken up and sold in parts. — Mitch Kapor (@mkapor) August 23, 2013
After 3 big losses (search, social and mobile) finally, Bill Gates gives up on Balmer. Microsoft CEO is leaving. — Vijay Shekhar (@vijayshekhar) August 23, 2013
Possible new Microsoft CEOs: Scott Forstall Meg Whitman Leo Apotheker John Sculley Ashton Kutcher Marissa Mayer Lex Luthor
— Matthew Panzarino (@panzer) August 23, 2013
What Steve Ballmer achieved at Microsoft is actually amazing. It’s underrated simply because consumer tech casts an irrationally big shadow.
— Anil Dash (@anildash) August 23, 2013
If only Ballmer had been shouting “mobile developers! mobile developers! mobile developers!”
— Josh Constine (@JoshConstine) August 23, 2013