Home' Trinidad and Tobago Guardian : August 24th 2013 Contents A21
Saturday, August 24, 2013 www.guardian.co.tt Guardian
NEW YORK---Microsoft CEO Steve
Ballmer, who helped Bill Gates transform
the company from a tiny startup into the
world s most valuable business, announced
plans Friday to retire sometime in the next
year---a move that presents another chal-
lenge to the tech giant as it struggles to
move beyond the era of the personal com-
Microsoft and other companies that thrived
in the PC business have been scrambling to
win back consumers who increasingly prefer
smartphones and tablets.
Detractors say Ballmer contributed to the
situation by not taking early threats from
Apple and Google seriously enough. He con-
sistently pooh-poohed Google as a one-trick
company and in 2007 declared: "No chance
that the iPhone is going to get any significant
Ballmer s jeers proved premature. Google
quickly made important inroads in Internet
video, online maps, e-mail and mobile com-
puting. Those successes contributed to the
damage that Apple s iPhone and iPad did to
Microsoft and its partners in the PC mar-
ket.Although it derives some three-quarters
of its revenue from sales of software and
services to businesses, Microsoft has failed
Microsoft says CEO Ballmer
to retire in 12 months
to capture the imagination of consumers who have
become more enamoured with mobile gadgets.
Response to the newest version of its flagship Windows
operating system, Windows 8, has been lukewarm.
When Ballmer took the helm in January 2000, the
company was worth more than US$601 billion. Today,
its value is less than half that amount, at nearly US$270
"There is never a perfect time for this type of tran-
sition, but now is the right time," Ballmer, 57, said in
a statement. He planned to stay on until a replacement
is found. Microsoft said the search committee would
After the news broke, Microsoft s stock shot up as
much as nine per cent and later came within two
dollars of a 52-week high.
Ballmer s announcement comes less than two
months after the company unveiled a sweeping reor-
ganisation of its business in an attempt to catch up
with Apple and Google.
In his statement, Ballmer noted that Microsoft is
moving in a new direction and needs a CEO that will
be there for the longer term.
Microsoft, he said, "has all its best days ahead."
Ballmer met Gates in 1973 while they were living
down a dormitory hall from each other at Harvard
University. He joined Microsoft in 1980 to bring some
business discipline and salesmanship to a company
that had just landed a contract to supply an operating
system for a personal computer that IBM would release
Ballmer, a zealous executive prone to arm-waving
and hollering, did the job so well that he would become
Gates sounding board and succeed him as CEO. He
has worked at Microsoft for 33 years, matching the
tenure of Gates, who left the company in 2008.
Though investors cheered the news on Friday, BGC
financial analyst Colin Gillis cautioned that it could
be a "tough 12 months" for the company.
The obvious successor---former Windows head
Steven Sinofsky---got booted by Ballmer, he said.
Veteran executive Julie Larson-Green, the head of
Microsoft s devices and studios engineering group,
has been floated as a potential successor. She was
promoted to her most recent position in July, after
being tapped in November to lead all Windows software
and hardware engineering.
Although the company said Friday that it will con-
sider both internal and external candidates, some ana-
lysts are betting that the company s next leader will
come from outside.
When Ballmer joined Microsoft in 1980, it was
populated with geeky programmers, led by Gates and
the other founder, Paul Allen. Ballmer had already
held a product-management job at Procter & Gamble
and was attending Stanford University s graduate
school of business when Gates convinced him to move
to the Seattle area to whip Microsoft into shape.
Ballmer dropped out of Stanford, but only after
Gates agreed to give him an 8.75 per cent stake in the
then-tiny startup that had not even incorporated as
a company. It turned out to be one of the world s
greatest business partnerships.
By late 2012, Ballmer had accumulated an estimated
fortune of nearly US$16 billion from his initial Microsoft
stake and additional stock options he later received.
He also was instrumental in growing Microsoft
from a company that had fewer than 40 employees
and US$12 million in annual revenue when he came
aboard. In 2012, Microsoft had 94,000 employees
and US$74 billion in annual revenue.
But Microsoft enjoyed its greatest success with
Gates at the helm and Ballmer as his sidekick.
Gates turned over the reins to Ballmer in January
2000 in what was considered to be a surprise move,
because Ballmer had been considered more of a num-
bers and sales specialist, not a technology specialist.
The CEO change came just a few weeks after
Microsoft s stock hit a record high of nearly US$60,
on a split-adjusted basis.
Janney Capital Markets analyst Yun Kim said
investors shouldn t get too excited, because the com-
pany itself won t change overnight.
Kim said the new CEO, who will likely come from
outside the company, faces the "daunting task" of
making Windows relevant amid the continued con-
sumer shift away from PCs. (AP)
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