Speculation grows that Microsoft's Ballmer will exit stage left

Published on Saturday 19 June 2010 15:03

MICROSOFT'S tough-talking chief executive Steve Ballmer and his legendary onstage outbursts could soon be yesterday's corporate entertainment.

When a dozen Scottish technology companies attend the software giant's global partners' get-together in Washington DC next month, it is likely it will be the last time they witness one of his wacky performances.

A growing list of US commentators predict that Ballmer will step aside from his executive role at Microsoft in a matter of months.

They range from Newsweek to several US-based technology websites. Pundit Adam Lashinsky of Fortune claims that Ballmer generates "more out-to-lunchness than ever displayed by a major CEO". One Scottish company executive and Microsoft Gold Partner who is attending the Washington event said: "It looks like Steve is on his way out."

It is two years since Ballmer stepped out of the shadow of his longtime friend Bill Gates, who decided in 2008 to spend all his time on global philanthropic activities through his Gates Foundation. Since then Ballmer has spent his time – some claim with a growing relish – battling his way through lawsuits, mergers, acquisitions and competitive tussles.

Microsoft recently lost its status as the world's most valuable technology company on the planet to the creator of the Apple iPod, iPhone and iPad.

Lashinsky said: "As he presides over the umpteenth reorganisation of the company, Ballmer knows the future of personal computing lies with mobile. Yet he continues to live in the past."

Of Microsoft's online business, he said: "The Bing search engine is making modest gains against industry leader Google, but Microsoft lost more than $700 million last quarter."

In "Ballmerworld" it did not appear to matter if the PC was shrinking in relevance. "For him any device is a computer and people will want to use Windows because they're so familiar with it," he added.

Some claim that Ballmer's fall from grace started between the spring of 2008 and last summer. It started when Microsoft made a $47.5bn hostile takeover bid to buy Yahoo.

On-and-off merger talks stretched out over months and the software company abandoned the offer. Fifteen months later the two announced a more limited deal.

Since then a partnership in internet search and advertising has seen Microsoft provide the underlying technology on Yahoo's popular websites. The two have spent reputed billions in their struggle to create a stronger rival to industry powerhouse Google.

The link-up between the two companies has not stopped the Yahoo Finance website highlighting anti-Ballmer views from the influential Silicon Alley Insider site. "Sorry, Steve. We think it's getting to be time for you to move on" is the none too subtle message, which goes on: "Yes, you love Microsoft, and you're the company's greatest cheerleader.

"That's not what Microsoft needs today. The two cash cows that support Microsoft – Windows and Office – are being assaulted by Apple and Google."

Silicon Alley's Jay Yarrow says Microsoft needs a chief executive who displays a "thorough understanding" of these dual threats and a plan to diffuse them. "So it doesn't appear to be you," he informs Ballmer.

Likely replacements include Kevin Turner, Microsoft's chief operating officer responsible for the company's global strategic and operational leadership.

Another is Steven Sinofsky, president of Microsoft's Windows and Windows Live division, including Windows 7.

When Sinofsky joined Microsoft in 2006, he warned Ballmer that the company should "not just do a little of everything" but concentrate on what it should do and then do that 100 per cent well.