September 20, 2005 11:43 AM PDT

Microsoft to reorg; Allchin to retire

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(continued from previous page)

between the Windows operating system division and the Office division that was a possibility from the federal government's antitrust lawsuit. "I could see where this could make it harder for Windows and Office groups to work together, and they do need to."

But Silver doesn't expect smoother operations out of the plan. "We're skeptical that this will change their execution at this point," he said.

Follow the leader
The promotion of Ozzie, who will report directly to Chairman Bill Gates, underscores just how important services have become to the company. "Microsoft sees software as a service as a part-answer to the maturing software market," said Rob Helm, director of research at Directions on Microsoft.

Ozzie's background means he is suited to the task, said Jamie Friedman, an analyst at Fulcrum Global Partners. "Ray Ozzie is a valuable technology resource, and his role now will be more delineated," Friedman said. "It's a better use of Ray and his skill set and training."

Another significant aspect of the reorg is the promotion of Eric Rudder, who is seen by some observers as a possible future leader of the software giant.

"Microsoft is maturing, and they really need marketing and sales people at the top."
--Rob Helm, director of research, Directions on Microsoft

Rudder will take on a new role, focusing on the company's overall technical strategy. He'll report directly to Gates. Rudder, who heads Microsoft's Server and Tools division, will move into his new post following the shipment of new versions of Microsoft's Visual Studio development tools and SQL Server database later this year.

One potential downside to the reorg is that morale among Microsoft's rank-and-file could be adversely affected, since Allchin and Rudder, two of the company's top technical experts, will depart key leadership positions, analyst Helm said.

"Microsoft is maturing, and they really need marketing and sales people at the top, but I am not sure employees want to hear (that)," Helm said. Johnson, heir to Allchin's throne as Windows chief, is not a geek, but has a sales background.

With the realignment, the new Platform Products and Services division, which includes Windows, will cover roughly 60 percent of Microsoft's revenue.

The Business division is expected to be the source of roughly 28 percent of the company's revenue, while the Entertainment and Devices Division will make up roughly 10 percent of the company's business.

Shares of Microsoft were virtually flat at $25.86 a share in later afternoon trading on Tuesday.

CNET News.com's Joris Evers and Dawn Kawamoto contributed to this report.

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54 comments

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Not retiring at all...
From article:
"Kevin Johnson and Jim Allchin will be co-presidents of the Platform Products and Services division[http://...|http://...]"

Doesn't sound like retirement to me...
Posted by powerclam (70 comments )
Reply Link Flag
They're making their shareholders happier
When you read through the PR verbage, what you really come away with is that Allchin couldn't deliver Longhorn in a timely manner, so he now has a shadow who is coming up to speed on all of Allchins responsibilities before he gets the boot (more commonly referred to as "spending more time with the family").

It was a good step to make the shareholders happy by showing that they are taking action to correct issues. But, this does not mean that Longhorn will ship out any sooner or with any near the feature set they had initially promised.
Posted by David Dudley (446 comments )
Link Flag
Future retirement...
The release from MS states Allchin will retire
upon release of Vista... For now, he's a
"co-president".
Posted by Gleeplewinky (289 comments )
Link Flag
Read further...
You didn't read the entire paragraph.
Posted by zaznet (1138 comments )
Link Flag
Not retiring at all...
From article:
"Kevin Johnson and Jim Allchin will be co-presidents of the Platform Products and Services division[http://...|http://...]"

Doesn't sound like retirement to me...
Posted by powerclam (70 comments )
Reply Link Flag
They're making their shareholders happier
When you read through the PR verbage, what you really come away with is that Allchin couldn't deliver Longhorn in a timely manner, so he now has a shadow who is coming up to speed on all of Allchins responsibilities before he gets the boot (more commonly referred to as "spending more time with the family").

It was a good step to make the shareholders happy by showing that they are taking action to correct issues. But, this does not mean that Longhorn will ship out any sooner or with any near the feature set they had initially promised.
Posted by David Dudley (446 comments )
Link Flag
Future retirement...
The release from MS states Allchin will retire
upon release of Vista... For now, he's a
"co-president".
Posted by Gleeplewinky (289 comments )
Link Flag
Read further...
You didn't read the entire paragraph.
Posted by zaznet (1138 comments )
Link Flag
ENOUGH ALREADY! CNET=VISTA PR SITE!
STOP this endless barrage of upcomming, currently vaporware
Longhorn / AstalaVista PR Web Site news!
Endless barrage of multiple stories that have already been hashed
around before about every tiny bit of news from Jurrassic Park
Redmond Campus One.

GO TO www.microsoft.com for further info & bypass C/NOT all
together.
How much money does Citizen Gates pay you per word anyway?
Posted by Llib Setag (951 comments )
Reply Link Flag
oh, please
if anything, cnet has been generally more negative about Microsoft than positive, if you were to compare the number of Microsoft stories to the number of Apple stories, Apple would get more than its fair (5%) share of coverage.

So c|net's gotten a little nicer to Microsoft now that they're mad at Google. They're still definitely no Microsoft PR firm.
Posted by TV James (680 comments )
Link Flag
Why do you come here?
You never seem to have anything positive to contribute. Why even bother coming if everything on the site annoys you? Are you just a glutton for punishment?
Posted by Christopher Hall (1205 comments )
Link Flag
They have an e-mail address for complaints
This is a TalkBack area, it is about the story, not about the site. I'm not even sure what you would rather? Would you prefer a mindlessly Anti-Microsoft Site full of why Microsoft is a big meanie and Google and Linux and Open-Source in general and Apple and RealPlayer are all Angels of Light who dance and frolick in fields of green lush grass and bright blossoming daisies at the end of a Monopolistic tunnel of pain and destruction?
Posted by Lord Kalthorn (86 comments )
Link Flag
ENOUGH ALREADY! CNET=VISTA PR SITE!
STOP this endless barrage of upcomming, currently vaporware
Longhorn / AstalaVista PR Web Site news!
Endless barrage of multiple stories that have already been hashed
around before about every tiny bit of news from Jurrassic Park
Redmond Campus One.

GO TO www.microsoft.com for further info & bypass C/NOT all
together.
How much money does Citizen Gates pay you per word anyway?
Posted by Llib Setag (951 comments )
Reply Link Flag
oh, please
if anything, cnet has been generally more negative about Microsoft than positive, if you were to compare the number of Microsoft stories to the number of Apple stories, Apple would get more than its fair (5%) share of coverage.

So c|net's gotten a little nicer to Microsoft now that they're mad at Google. They're still definitely no Microsoft PR firm.
Posted by TV James (680 comments )
Link Flag
Why do you come here?
You never seem to have anything positive to contribute. Why even bother coming if everything on the site annoys you? Are you just a glutton for punishment?
Posted by Christopher Hall (1205 comments )
Link Flag
They have an e-mail address for complaints
This is a TalkBack area, it is about the story, not about the site. I'm not even sure what you would rather? Would you prefer a mindlessly Anti-Microsoft Site full of why Microsoft is a big meanie and Google and Linux and Open-Source in general and Apple and RealPlayer are all Angels of Light who dance and frolick in fields of green lush grass and bright blossoming daisies at the end of a Monopolistic tunnel of pain and destruction?
Posted by Lord Kalthorn (86 comments )
Link Flag
It's more like...
Division of OurOSorNoOS, Division of Office NoCompetitionAllowed, and Division of BrowserStandardsAreForP***ies. lol
Posted by NahNood (5 comments )
Reply Link Flag
It's more like...
Division of OurOSorNoOS, Division of Office NoCompetitionAllowed, and Division of BrowserStandardsAreForP***ies. lol
Posted by NahNood (5 comments )
Reply Link Flag
Heads are gonna Roll, the ship is unstable, Good News
Well for once they might actually be doing something to produce
positive results. Shortening the line between the customer and
the honchos at the top would be a good start, too bad they didnt
try this sooner. Keeping Jim Allchin til Vista is a sendoff that
should happen much sooner however.

This guy doesnt know his customer, or his product; when I read
his numerous interviews in eWeek and InfoWorld, he says
nothing that indicates he is even in the software business, he
sounds mostly political, like a cheap salesman in that regard.

I guess this news is more about the way those at the top of MS
are scrambling to man the ship with a new look, doing anything
they can to make some news, otherwise Google gets all the
attention.

While MS is not in danger of disappearing soon, they have hit
their peak and now must accept that they are old news, and we
customers are tired of the sloppy products we get.
Posted by (39 comments )
Reply Link Flag
Executive Management ARE Salespeople
Generally, the role of any executive is to be a politician and salesperson. How much work do you think they actually do? I would bet most of their time is spent at meetings with either other internal management or conducting/assisting sales for large customers. Munich doesn't want Windows and Office? Steve Ballmer flies out, trying his damndest to convince them to keep on giving them cash (We can't have people drop capitalism for communism, can we? Then others would surely follow suit and then goes our world economy we've fought so hard for). I've always assumed that the CEO of any company is the head salesperson of sorts and his executive underlings are his junior salesperson, doing their masters bidding.

Furthermore, if good old Jimmy Jammmers Allchin is being vague in his interviews, then how is he any different from his boss, Gates? If you read Bill's interviews, he speaks like Yoda about concepts that are supposed to be profound or grand, but really are just a rehashing of the same old same old.
Posted by David Dudley (446 comments )
Link Flag
Heads are gonna Roll, the ship is unstable, Good News
Well for once they might actually be doing something to produce
positive results. Shortening the line between the customer and
the honchos at the top would be a good start, too bad they didnt
try this sooner. Keeping Jim Allchin til Vista is a sendoff that
should happen much sooner however.

This guy doesnt know his customer, or his product; when I read
his numerous interviews in eWeek and InfoWorld, he says
nothing that indicates he is even in the software business, he
sounds mostly political, like a cheap salesman in that regard.

I guess this news is more about the way those at the top of MS
are scrambling to man the ship with a new look, doing anything
they can to make some news, otherwise Google gets all the
attention.

While MS is not in danger of disappearing soon, they have hit
their peak and now must accept that they are old news, and we
customers are tired of the sloppy products we get.
Posted by (39 comments )
Reply Link Flag
Executive Management ARE Salespeople
Generally, the role of any executive is to be a politician and salesperson. How much work do you think they actually do? I would bet most of their time is spent at meetings with either other internal management or conducting/assisting sales for large customers. Munich doesn't want Windows and Office? Steve Ballmer flies out, trying his damndest to convince them to keep on giving them cash (We can't have people drop capitalism for communism, can we? Then others would surely follow suit and then goes our world economy we've fought so hard for). I've always assumed that the CEO of any company is the head salesperson of sorts and his executive underlings are his junior salesperson, doing their masters bidding.

Furthermore, if good old Jimmy Jammmers Allchin is being vague in his interviews, then how is he any different from his boss, Gates? If you read Bill's interviews, he speaks like Yoda about concepts that are supposed to be profound or grand, but really are just a rehashing of the same old same old.
Posted by David Dudley (446 comments )
Link Flag
"They did what the DOJ couldn't,"
Heck if the breakuphad happened they could have been more
efficient years earlier!

Ha!
Posted by technewsjunkie (1265 comments )
Reply Link Flag
They had this planned long ago
Back when the break up was a possibility Microsoft had already planned out this reorg. They instead performed a different reorg in an attempt to prove to the courts that the DoJ's suggestion wouldn't work to best meet the needs of their customers.

It is ironic that they are now going back to those old plans in order to survive in the current market.
Posted by zaznet (1138 comments )
Link Flag
"They did what the DOJ couldn't,"
Heck if the breakuphad happened they could have been more
efficient years earlier!

Ha!
Posted by technewsjunkie (1265 comments )
Reply Link Flag
They had this planned long ago
Back when the break up was a possibility Microsoft had already planned out this reorg. They instead performed a different reorg in an attempt to prove to the courts that the DoJ's suggestion wouldn't work to best meet the needs of their customers.

It is ironic that they are now going back to those old plans in order to survive in the current market.
Posted by zaznet (1138 comments )
Link Flag
Heads are gonna Roll, the ship is unstable, Good News
Well for once they might actually be doing something to produce
positive results. Shortening the line between the customer and
the honchos at the top would be a good start, too bad they didnt
try this sooner. Keeping Jim Allchin til Vista is a sendoff that
should happen much sooner however.

This guy doesnt know his customer, or his product; when I read
his numerous interviews in eWeek and InfoWorld, he says
nothing that indicates he is even in the software business, he
sounds mostly political, like a cheap salesman in that regard.

I guess this news is more about the way those at the top of MS
are scrambling to man the ship with a new look, doing anything
they can to make some news, otherwise Google gets all the
attention.

While MS is not in danger of disappearing soon, they have hit
their peak and now must accept that they are old news, and we
customers are tired of the sloppy products we get.
Posted by (39 comments )
Reply Link Flag
Heads are gonna Roll, the ship is unstable, Good News
Well for once they might actually be doing something to produce
positive results. Shortening the line between the customer and
the honchos at the top would be a good start, too bad they didnt
try this sooner. Keeping Jim Allchin til Vista is a sendoff that
should happen much sooner however.

This guy doesnt know his customer, or his product; when I read
his numerous interviews in eWeek and InfoWorld, he says
nothing that indicates he is even in the software business, he
sounds mostly political, like a cheap salesman in that regard.

I guess this news is more about the way those at the top of MS
are scrambling to man the ship with a new look, doing anything
they can to make some news, otherwise Google gets all the
attention.

While MS is not in danger of disappearing soon, they have hit
their peak and now must accept that they are old news, and we
customers are tired of the sloppy products we get.
Posted by (39 comments )
Reply Link Flag
My calendar's out of whack
Usually, you could tell it was spring if Microsoft was reorganizing. But a reorg in September? This just confuses everything.
Posted by TV James (680 comments )
Reply Link Flag
My calendar's out of whack
Usually, you could tell it was spring if Microsoft was reorganizing. But a reorg in September? This just confuses everything.
Posted by TV James (680 comments )
Reply Link Flag
Capt. Balmer, the Ship is Sinking
Their just re-arranging the deck chairs on a sinking ship. With
Balmer at the helm MS is doomed. That man is a fool.
Posted by cjohn17 (268 comments )
Reply Link Flag
Ballmer is not the only one to blame
I wouldn't be so harsh on the man myself, but I would say that ever since he took the helm, their stock has been in a decline and their growth has slowed considerably. Obviously, he is not the only person responsible for this decline as Bill Gates and all the other execs are still there making big decisions, but Ballmer is now the "rodeo clown" who garners most of our attention.

Obviously, the company needs to rethink some of its strategies, for example investing in such expensive things that obviously cannot yield a decent ROI (buying Great Plains for example).

Maybe the weight loss program he went on a few years back zapped some of his brain power. ;)
Posted by David Dudley (446 comments )
Link Flag
Capt. Balmer, the Ship is Sinking
Their just re-arranging the deck chairs on a sinking ship. With
Balmer at the helm MS is doomed. That man is a fool.
Posted by cjohn17 (268 comments )
Reply Link Flag
Ballmer is not the only one to blame
I wouldn't be so harsh on the man myself, but I would say that ever since he took the helm, their stock has been in a decline and their growth has slowed considerably. Obviously, he is not the only person responsible for this decline as Bill Gates and all the other execs are still there making big decisions, but Ballmer is now the "rodeo clown" who garners most of our attention.

Obviously, the company needs to rethink some of its strategies, for example investing in such expensive things that obviously cannot yield a decent ROI (buying Great Plains for example).

Maybe the weight loss program he went on a few years back zapped some of his brain power. ;)
Posted by David Dudley (446 comments )
Link Flag
Here's The Problem!
<a class="jive-link-external" href="http://www.ntk.net/ballmer/mirrors.html" target="_newWindow">http://www.ntk.net/ballmer/mirrors.html</a>

BALLMER STOPPED DANCIN' !!!

;-)
Posted by open-mind (1027 comments )
Reply Link Flag
Here's The Problem!
<a class="jive-link-external" href="http://www.ntk.net/ballmer/mirrors.html" target="_newWindow">http://www.ntk.net/ballmer/mirrors.html</a>

BALLMER STOPPED DANCIN' !!!

;-)
Posted by open-mind (1027 comments )
Reply Link Flag
Who cares?
As of 2002 i've not used anything made by Microsoft. I feel sorry
for anyone who still has to use it. Most big companies get top
heavy and decline after a number of years, it appears that
Microsoft's time has come.
Posted by thomcarl (72 comments )
Reply Link Flag
Who cares?
As of 2002 i've not used anything made by Microsoft. I feel sorry
for anyone who still has to use it. Most big companies get top
heavy and decline after a number of years, it appears that
Microsoft's time has come.
Posted by thomcarl (72 comments )
Reply Link Flag
Programmers call it a null op...
The reorganization shifts titles and
agglomerates smaller divisions into larger ones.
Ostensibly, this is to make the company more
"agile", but it's more likely that the move is
simply recognition of shareholder unease and as
a move to seem proactive.

The major management and central control of the
company is unchanged. Larger business units are
typically much less responsive when upper
management retains a high level of control (such
as Microsoft) because the upper tiers have more
concerns and they more often conflict, so
"agility" is not a likely a result.

The move doesn't address what analysts and
employees cite as being seriouly wrong, that
being too much management and too little
emphasis on product development. This is
compounded with Microsoft's attempting to move
into new markets (like ERM) with the same
approach as past products (bulk consumer and
business), and it's not going well.

If you check employee blogs, the reorg is simply
SNAFU and isn't perceived as presenting any
meaningful change to the company (which they
unanimously indicate is needed).

Where it used to be solely MS-bashers saying
that Microsoft has "jumped the shark," we're
hearing that a lot more of that from analysts
and, more importantly, Microsoft's own employees
(present and past). MS is not the darling
investment it once was and I suspect senior
management is aware that people are looking at
Office 12 and Vista to see how it goes. Anything
short of a genuine spectactular response to
those products will devestate the company.
Posted by Gleeplewinky (289 comments )
Reply Link Flag
More about Shareholders?
Has everybody become a Bureaucratic Pig-Dog? I don't agree that the reorganisation is a good point, but why all this pondering about how Shareholders feel about what Microsoft is doing? Shareholders are stupid, stupid people who have made money off Microsoft well over what they originally paid for it, I doubt anybody has lost money at least, even if they haven't made much. They don't care about Microsoft beyond how much more money they can suck from the company.

Why does anybody care what they think?
Posted by Lord Kalthorn (86 comments )
Link Flag
Programmers call it a null op...
The reorganization shifts titles and
agglomerates smaller divisions into larger ones.
Ostensibly, this is to make the company more
"agile", but it's more likely that the move is
simply recognition of shareholder unease and as
a move to seem proactive.

The major management and central control of the
company is unchanged. Larger business units are
typically much less responsive when upper
management retains a high level of control (such
as Microsoft) because the upper tiers have more
concerns and they more often conflict, so
"agility" is not a likely a result.

The move doesn't address what analysts and
employees cite as being seriouly wrong, that
being too much management and too little
emphasis on product development. This is
compounded with Microsoft's attempting to move
into new markets (like ERM) with the same
approach as past products (bulk consumer and
business), and it's not going well.

If you check employee blogs, the reorg is simply
SNAFU and isn't perceived as presenting any
meaningful change to the company (which they
unanimously indicate is needed).

Where it used to be solely MS-bashers saying
that Microsoft has "jumped the shark," we're
hearing that a lot more of that from analysts
and, more importantly, Microsoft's own employees
(present and past). MS is not the darling
investment it once was and I suspect senior
management is aware that people are looking at
Office 12 and Vista to see how it goes. Anything
short of a genuine spectactular response to
those products will devestate the company.
Posted by Gleeplewinky (289 comments )
Reply Link Flag
More about Shareholders?
Has everybody become a Bureaucratic Pig-Dog? I don't agree that the reorganisation is a good point, but why all this pondering about how Shareholders feel about what Microsoft is doing? Shareholders are stupid, stupid people who have made money off Microsoft well over what they originally paid for it, I doubt anybody has lost money at least, even if they haven't made much. They don't care about Microsoft beyond how much more money they can suck from the company.

Why does anybody care what they think?
Posted by Lord Kalthorn (86 comments )
Link Flag
As long as Gates remains as "Chief Architect", products are doomed
Bill Gates may have talents, but system architecture was never one of them. Any successful architectural feature MS ever had was bought from someone else: IBM provided this expertise in the old days.

The system flaws which pervade MS products are the direct consequence of a failed, incompetent, architectural plan which pervades every product line. Until a drastic change is made in this area, MS products will continue their slide from serious products toward flashy, increasingly unreliable "toys."
Posted by landlines (54 comments )
Reply Link Flag
The scale is impressive
The scale on which Microsoft products are used is probably the reason you actually believe this. I'm pretty sure you haven't actually seen any Microsoft Code, so it must be. So a ten thousand people let's say have a systems crash on Windows. A hundred thousand have a Critical problem that restarts their computer, a million have a simple problem that is easily fixed. Not only are half of those all the user's fault for not patching properly, because in thirteen years of using Windows I have crashed once, because I keep my Computer updated and feeling good. Not only that, but more than a Billion more people don't have a problem. I don't think you'll find an Operating System where less than one in every thousand people have a minor problem every now and then. And you most certainly won't find one where only one in every ten thousand people has a system crash! Counting only Operating Systems that have ten thousand or more people using it :P

Now by all means, if you could find an alternative operating system that could operate in excess of I don't know... there are say 2 Billion Computers? 1.6 Billion Computers, with hundreds of millions of some of the smartest progammers attacking those computers every day, and some of the most stupid spyware makers trying new ways to get in. 1.6 Billion Computers, none in the same configuration, all different in some way, all working? On one piece of code?

I don't think you'd be able to do it.
Posted by Lord Kalthorn (86 comments )
Link Flag
As long as Gates remains as "Chief Architect", products are doomed
Bill Gates may have talents, but system architecture was never one of them. Any successful architectural feature MS ever had was bought from someone else: IBM provided this expertise in the old days.

The system flaws which pervade MS products are the direct consequence of a failed, incompetent, architectural plan which pervades every product line. Until a drastic change is made in this area, MS products will continue their slide from serious products toward flashy, increasingly unreliable "toys."
Posted by landlines (54 comments )
Reply Link Flag
The scale is impressive
The scale on which Microsoft products are used is probably the reason you actually believe this. I'm pretty sure you haven't actually seen any Microsoft Code, so it must be. So a ten thousand people let's say have a systems crash on Windows. A hundred thousand have a Critical problem that restarts their computer, a million have a simple problem that is easily fixed. Not only are half of those all the user's fault for not patching properly, because in thirteen years of using Windows I have crashed once, because I keep my Computer updated and feeling good. Not only that, but more than a Billion more people don't have a problem. I don't think you'll find an Operating System where less than one in every thousand people have a minor problem every now and then. And you most certainly won't find one where only one in every ten thousand people has a system crash! Counting only Operating Systems that have ten thousand or more people using it :P

Now by all means, if you could find an alternative operating system that could operate in excess of I don't know... there are say 2 Billion Computers? 1.6 Billion Computers, with hundreds of millions of some of the smartest progammers attacking those computers every day, and some of the most stupid spyware makers trying new ways to get in. 1.6 Billion Computers, none in the same configuration, all different in some way, all working? On one piece of code?

I don't think you'd be able to do it.
Posted by Lord Kalthorn (86 comments )
Link Flag
 

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