Davis told the troops of his departure at a recently concluded staff meeting.
"Just told my colleagues of 10 yrs I'm leaving company I founded," Davis said in a Twitter posting. "What a wonderful journey. Thank you, Tellme!"
The Tellme unit will become part of a "speech center of excellence" to be led by Zig Serafin, a 10-year Microsoft veteran. That unit will also include Microsoft's separate Speech Components Group. Serafin said in an interview that Davis and McCue are the only high-level departures and shrugged off the suggestion that Microsoft may have trouble hanging on to Tellme's rank and file.
"I'm not new to the group," said Serafin, who will lead a combined unit that includes Tellme's staff as well as others at the company who work on speech technology. The group spans teams in Mountain View, Calif., where Tellme has offices, as well as Redmond, Wash., and Beijing. Serafin noted that he was deeply involved in helping Tellme integrate with the company in the year following its acquisition by Microsoft in 2007.
"For the first year I worked with Mike to help him connect in with Microsoft and how to navigate the company," he said. Serafin was even there on Super Bowl Sunday in 2007 as Microsoft CEO Steve Ballmer worked to persuade McCue to sell, with Ballmer accidentally spilling a soda on McCue during one excited outburst.
"I've been there since the beginning and the leaders recognize that," Serafin said.
Serafin said that the Tellme unit, like other Microsoft divisions, was affected by recent layoffs. However, he said that Microsoft isn't abandoning any of the many areas in which Tellme was working, including Microsoft's mobile phone, automotive and mobile units. Tellme also has its own consumer service and application as well as an enterprise business that sells a voice-recognition-based phone service to large and mid-size businesses.
"Microsoft believes that speech is a natural user interface that will be used in a wide range of consumer and business applications," Serafin said. "We think there is an opportunity to further move the needle forward as far as what role speech plays as a natural user interface."
With 400 people on the team, Serafin said that Microsoft has the broadest speech effort in the industry.
"There's no group in the industry that has this combination of assets working across software and services for speech."
Among the projects Serafin will inherit: coming up with a Tellme app for the iPhone. Last year, a Tellme executive said an alpha version was already being tested and said a final product would be ready by June.
Microsoft now says it will miss that target. Although an iPhone version of Tellme's voice-powered search is still being developed, the company plans to release it only after the Windows Mobile 6.5 version of the Tellme app, which is due in the fall.