Steve Ballmer Planning Major Restructuring at Microsoft

In last year’s Shareholder Letter, Microsoft CEO Steve Ballmer wrote

Last year in this letter I said that over time, the full value of our software will be seen and felt in how people use devices and services at work and in their personal lives. This is a significant shift, both in what we do and how we see ourselves — as a devices and services company. It impacts how we run the company, how we develop new experiences, and how we take products to market for both consumers and businesses. The work we have accomplished in the past year and the roadmap in front of us brings this to life.

I think we can all agree Microsoft certainly has moved to become more of a devices and services.  Products have been unified, brands have been solidified, and a faster, bolder company has emerged.

Ballmer is now planning on a significant restructuring of the corporate hierarchy, shuffling around many executives into more prominent positions, to align with Microsoft’s vision of a Devices and Services company.  Executives who may benefit most from this restructuring with expanded roles are Satya Nadella, president of its Servers and Tools division; Tony Bates, president of its Skype communications division; and Don Mattrick, president of its Interactive Entertainment division (Xbox). Microsoft is also looking to further simplify its management structure in this reorganization.

This also may mark the first time where the Windows division will be less powerful than it was before, especially with Julie-Larson Green and Tami Reller “in charge.”  As services and devices become important, the Xbox, Skype, and Bing divisions will be just as important as Windows.  It will also be interesting to see who takes over Windows.  It was rumored that Steven Sinofsky was looking to integrate the Windows Phone Division into the Windows Division before he ended up leaving.  Clearly someone needs to take over Windows Phone.

Hopefully we will also see more devices from Microsoft too.  This restructuring will likely happen slowly over time, finishing with the release of Windows 8.1.  Oh, and of course Steve Ballmer remains CEO.

Source: Mary-Jo Foley

About the author  ⁄ Suril Amin

Suril is a scientist, journalist and obsessive Microsoft observer. He holds an advanced degree in Biotechnology with minors in Biochemistry, Microbiology, and Molecular Biology. Send him tips on twitter: http://www.twitter.com/surilamin

  • koenshaku

    Restructure the previous zune team while they’re at it and bring back zune or a comparable sync and music playing app!

    • http://twitter.com/surilamin surilamin

      Robbie Bach and J Allard are long gone. A completely new Xbox Music App is coming in Windows 8.1.

      • PoohGQ

        ..And I think they should reconsider making Xbox Music/Video the new sync tool for Windows Phones too.. I don’t seem to understand why they had to have a separate app for WP8 when Zune worked good..Except of course for the lack of syncing with docs..

  • freeiam

    This is the end of Micro$oft

    • grs_dev

      I agree. I sense a Micro$$$$oft is on the horizon.

  • grs_dev

    Products and Services company means the days of being able to buy a license of Windows or Office are numbered.

    The model going forward is to get consumers and businesses to either pay for a subscription based product such as Office 365, Skype, Xbox Live, and such AND to offer devices that are powered by Microsoft intellectual property and services even such as the Surface, OEM products like Asus, HP, Dell and Lenovo.

    If this prediction pans out then expect a huge, I MEAN HUGE, MASSIVE shift in paradigm for enterprise customers who currently spend about $20 BB on Microsoft tools and server products.

    This is really interesting. Just a few weeks ago, the President of Microsoft Servers and Tools Division, Satya Nadella said basically what can be translated into Microsoft needs to and intends to significantly grow the Services and Tools Division. It’s a 2 Trillion dollar market and Microsoft only commands 1% of it. The upside there is HUGE!!! WOW