Microsoft’s Ballmer In Firing Line As Gates Departs - InformationWeek

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Software // Operating Systems

Microsoft’s Ballmer In Firing Line As Gates Departs

The question is whether Ballmer, as a solo act, is up to leading Microsoft through its next set of hurdles.

Microsoft kicks off a new fiscal year Tuesday facing numerous challenges. That in itself is not unique for the world’s biggest software maker. Over the years, it's had to navigate various tech industry shifts to maintain its dominance -- including the rise of the Internet, the emergence of open source computing, the dot-com collapse, and increasing regulatory scrutiny of its industry.

Through it all, there's been one constant at Microsoft. Make that two: Bill Gates and Steve Ballmer. Gates, as chairman and chief software architect, was the visionary. He was the big thinker who pondered future trends and what they would mean for his company. CEO Ballmer was the tactician, a super salesman whose job was to win big customers while using shrewd moves -- or bullying and bluster -- to keep competitors at bay.

Starting Monday, Ballmer will have to be both. Gates stepped down Friday from full-time duties at Microsoft to concentrate on philanthropic efforts, though he will remain the company's nominal chairman.

That raises the question of whether Ballmer, as a solo act, is up to leading Microsoft through its next set of hurdles. It's a top-of-mind question for investors, partners, customers, regulators, and numerous other parties impacted one way or another by the company's far-reaching tentacles.

And it's a particularly keen topic given that Microsoft may be more vulnerable to competitors than at any other time in its 33-year history.

The company's current operating system, Windows Vista, has been poorly received. Customers have balked at its cost, heavy resource requirements, and lack of compatibility with older software.

Disappointment with Vista has been such that Microsoft's Windows sales plunged 25% in the most recent quarter.

Meanwhile, Apple's Mac sales are surging and even Linux, an open source OS that was once the sole preserve of techno-geeks, has been showing up on PCs sold at Wal-Mart.

Ballmer, 52, says he wants to remain at Microsoft's helm for 10 years. If he's to survive for even half of that, he'll have to ensure that Microsoft's next OS, Windows 7, fares better than Vista when it's launched in 2010.

Ballmer also needs, urgently, to clarify Microsoft's Internet strategy and start putting the pieces in place. The company is No. 3, or worse, in almost every important Net metric, behind Google, Yahoo, and other players.

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