Does Ballmer Need To Go?

Pickens notes a TechCrunch analysis wondering — after Windows Vista and the failed Yahoo bid — whether Steve Ballmer's days at Microsoft are numbered. "Ballmer has been the big driver behind [the Yahoo] deal at Microsoft — some would say to the point of obsession. After the disaster that has been Windows Vista, Ballmer may have realized he needed to redeem himself in the eyes of Microsoft's board. And the 'transformative' deal with Yahoo was the way he was going to do it... If Microsoft's board loses patience with him, it might have to ask Bill Gates to temporarily come back as CEO until it finds a replacement. After all, Ballmer has already made a strong and convincing case for why Microsoft needs Yahoo to make its online and advertising strategy work. It's not clear whether Microsoft can achieve its objectives on its own or through other acquisitions. Maybe Ballmer thinks he can still do the deal by making Yahoo's stock price collapse and come back with a hostile offer."

Comments

yes - duh

[QuantumG]

And, the slowest moving company award goes to.......

yes - but

[Cryacin]

The fastest moving chair in a company award goes to...

Re:yes - but

[jsse]

This time Ballmer would fly with his chair.

Re:yes - but

[phagstrom]

..through the Windows

Re:yes - but

[aldm]

He's chair man, isn't he?

Three words

[TRRosen]

YES...YES...YES...!!!!

Concerning the Yahoo deal

[eclectro]

Microsoft dropped the Ballmer.

Re:Concerning the Yahoo deal

[koko775]

*sigh* No, no it didn't.

To be honest, the only reason I go to Slashdot anymore over programming.reddit & news.ycombinator is because the comments and moderation are better and I get a higher %age of stories relevant to my interests. But then I see this epitome of lazy editing...sigh.

Here's the link for your reference:
http://www.alleyinsider.com/2008/5/battered_yahoo_caves_admits_it_overplayed_hand_now_open_to_new_microsoft_talks
As the url would imply, Yahoo is caving. Ballmer is thus (much to my dismay) validated.

Re:Concerning the Yahoo deal

[xtracto]

This kind of stories is what makes slashdot so funny for me.

You got all these anti-Microsoft zealots so eager to bash and say things about Ballmer and anything at Microsoft even when they do not have any idea of what they are talking about.

Meanwhile, Steve Ballmer played a very good hand, knowing that Jerry was bluffing. It is funny to read those comments showing the "proofs" of how Microsoft is doing so bad, how its stock is going down and how they are at the edge of a disastrous crisis.

If we talk about "reality distortion fields", a lot of guys (the majority?) of people frequently commenting on slashdot are really affected by the anti-Microsoft zealotry. They really should get out of their basements... they would be surprised.

As the article you point says, Ballmer played a really clever hand. At the end, Microsoft did know that the stockholders would very gladly accept their offer.

As it can be seen in the article pointed by parent post and other business related articles, Yahoo! major stockholders are not basement-nerds or bearded-Free software-zealots. They are the one of the most successful asset management firms who do not care about the religious wars but only about how much is the stock. And the reality is that the offer made by Microsoft was a good one.

Now, after Ballmer drop the offer, the reaction was a lowering of Yahoo!'s stock price. And, as it is said, ultimately it will result in a better bang for the buck for Microsoft.

If there is any CEO who may be thrown out, it is not Steve, but Jerry.

Raise time

[Harmonious Botch]

TFA seems to assume that Balmer wanted to aquire Yahoo, and then did it entirely on his own initiative. That is certainly not the case. Even in a company as big as MS, the CEO does not go about spending that kind of money without the approval of major stockholders. He must have had the blessing of at least Bill Gates and Paul Allen, and probably others.
All of them knew going in that Yahoo had to voluntarily cooperate. So they know that Balmer is not to blame. So they are not going to dismiss him. They are going to go to plan B: the hostile takeover.
And what kind of person do you want leading a hostile takeover? You want the most vicious, gut-ripping, back-stabbing, ball-cutting executive you can find. They'll give him a raise.

over stating things a bit

[timmarhy]

all the conspiracy theories are too over the top. the business world is no where near this dramatic.

The Yahoo bid didn't really fail as such

[Eskarel]

It was more Microsoft offered them quite a reasonable price for it($33 per share), the Yahoo board asked for substantially more($37 per share) refused to budge and Microsoft said forget it.

The yahoo board are more likely to be fired by the shareholders than Balmer.

For that matter Vista isn't really all that much of a failure in the long run, it gets a lot of bad press, but it's not a horrible OS, and even if financially it does turn into the next ME, the lessons they've learned will still be useful in the next OS.

Balmer has been with Microsoft for a long time, and given that everyone will think that the Microsoft CEO is a vicious, greedy, vindictive SOB even if they put a saint in the position, they may as well get the benefits of an actual vicious, greedy, vindictive SOB.

Yahoo will not factor in.

[will_die]

That Microsoft did not get Yahoo is not something that Ballmer or Microsoft will not be blamed for. He set a price and when it was not accepted tried various negoiations and when that failed he walked away. Smart business.
He now just has to show how Microsoft will build software to fit the roll Yahoo would, but he has this year or longer to do that.

Now if you are the CEO of Yahoo you better be about to deliever the golden goose.

Re:Yahoo will not factor in.

[Kelz]

3/4s of a companies total assets is not pocket change, for any company.

Oh Yahoo gets punished too

[SuperKendall]

The yahoo board are more likely to be fired by the shareholders than Balmer.

I don't think anyone is saying people at Yahoo are not going to face some heat either. They're just saying that the whole deal was really pushed by Balmer and since he couldn't make it happen, he may well pay.

For that matter Vista isn't really all that much of a failure in the long run, it gets a lot of bad press, but it's not a horrible OS,

Doesn't matter how good it is if it continues to get horrible press.

Balmer has been with Microsoft for a long time, and given that everyone will think that the Microsoft CEO is a vicious, greedy, vindictive SOB even if they put a saint in the position, they may as well get the benefits of an actual vicious, greedy, vindictive SOB.

But there's the problem. He doesn't come off looking very vicious or greedy when he backs off at the first counteroffer. "Lame Duck" springs to mind.

Xbox Fiasco, Zune, Vista, Stock Price

[Anonymous Coward]

Ballmer took over in 2000. Here is Microsoft's stock performance since 2000:

http://finance.yahoo.com/q/bc?s=MSFT&t=my&l=on&z=m&q=l&c=

Ballmer is responsible for:

* The 7+ billion dollar Xbox fiasco

* The Zune marketplace flop

* The PR disaster that Vista has become

* Mass exodus of Microsoft employees to Google and other exciting and growing companies

* A total failure to get anywhere with Search and Advertising

Ballmer has been a complete failure in every single effort by Microsoft to create viable products outside of their core OS/office software/server software products.

Re:Xbox Fiasco, Zune, Vista, Stock Price

[Anonymous Coward]

Ballmer took over in 2000. Here is Microsoft's stock performance since 2000:

http://finance.yahoo.com/q/bc?s=MSFT&t=my&l=on&z=m&q=l&c=

Here is the performance of the NASDAQ COMPUTER index since 2000:

http://finance.yahoo.com/q/bc?s=%5EIXK&t=my&l=on&z=m&q=l&c=

Does that look familiar? (The "Interactive" option allows you to put MSFT on the same chart.)

Doesn't anyone remember the Dot-com bubble and all those new clueless investors overvaluing any tech company that looked somewhat successful? Note that MSFT's P/E ratio is currently at a somewhat sane 16.9.

Re:Xbox Fiasco, Zune, Vista, Stock Price

[mrbluze]

Ballmer is responsible for:

[... pretty much everything that microsoft did for eight years which, for microsoft, was a bad move...]

Yeah, but how is this bad for anyone else but Microsoft Corp? I say keep Ballmer and watch everybody else grow!

Re:Xbox Fiasco, Zune, Vista, Stock Price

[dhavleak]

Ballmer took over in 2000... Ballmer took over after (or around) the US DOJ ruling on MSFT. Under Ballmer, MS has been functioning under very heavy regulatory oversight, running scared from lawsuits (alcatel-lucent, the big antivirus vendors, adobe, google, just about everyone has sued or threatened to sue), been treated like an ATM machine by the EU, and much more.

Your point about the stock price is still valid, but there is the dot com bubble burst that affected MSFT as much as everybody else that you need to factor in.

A more accurate assessment would be:
- Net income has gone up from 8 billion to 14 billion per year
- Headcount has increased from 35,000 to 80,000
- Revenue has increased from 25 billions dollars to 51 billion dollars per year

From what you read about MS on this site, you'd think it's demise is pretty imminent. The numbers tell a different tale, and they don't make Ballmer look too bad either.

The 'demise being imminent' part isn't too far fetched of course -- MS is under threat from all directions (linux, apple, google, adobe, sony, ibm, ...). But most importantly it isn't clear how much longer their current business model is viable. That's what the yahoo offer was about. Most companies would be in denial about it, if they were able to continuously generate the sort of numbers MS does. Upper management would be full of back-slapping, and big bonuses. MSFT is very aware of the problems facing them, and the credit needs to go to the top dog -- Ballmer.

Re:Xbox Fiasco, Zune, Vista, Stock Price

[dhavleak]

Ah yes, the inevitable 'MS is doomed' straw man rebuttal... It's not a straw man if I actually backed it up myself in the very same post. Read the part about their business model. I didn't go into detail because the discussion is about Ballmer, but I can if you wish.

Re:Xbox Fiasco, Zune, Vista, Stock Price

[Sosarian]

Although he sold quite a bit in 1998 to start his foundation...according to this
http://www.microsoft.com/msft/reports/proxy2007.mspx
he is still the largest individual stock holder at 9%.

Re:Xbox Fiasco, Zune, Vista, Stock Price

[hey!]

Actually, the stock's performance is surprisingly GOOD.

The 1990s was the end of the era of PC adoption. I started work in the early 80's, which with the introduction of the microcomputer was the star of that era. Back in the late 80's and early 90's, we never bought computers onesies and twosies, we bought them literally by the truckload to computer-up entire departments at a time. It's been widely observed that while Microsoft was strongly against "software piracy" ideologically, it benefited from a certain level of "piracy" through economic network effects. Worrying about "piracy" was like worrying about the little fish that slipped through the holes in your net, whilst your net was completely full of big fish.

Microsoft was a company that was predicated on exponential growth in demand for its products. In the 80s through mid 90s it was driven by PC adoption, but the thoughtful among us always believed that was not sustainable. In the mid to late 90s the era of exponential adoption was extended for a few years by the dot com bubble.

Where are the exponential growth drivers of the twenty-first century? Well, there aren't any like the 80s-90s, but to the degree they exist they are in consumer markets. Microsoft had never been a consumer company. It never had consumer loyalty. It was a company that sold things to people who make purchase decisions on the behalf of others.

Microsoft's XBox and Zune efforts were, in the culture of Microsoft, bold and appropriate steps. Microsoft has for most of its existence been defined by dramatic, market beating growth. That is not in the cards in its PC software business. So it "had to" go where the growth was. They are strategic products. XBox is the more successful of the two, but arguably Zune is the more strategically important, because it is an attempt by Microsoft to leverage its PC monopoly into becoming a pinch point for digital entertainment providers.

It has a formula for digital entertainment, and it's the good old one that's worked so often for them before: appeal to people who make decisions on the behalf of consumers. In this case it's all about DRM. DRM isn't just an ideological choice, it's a strategic choice for Microsoft. What they offer is control of the platform. They offer some of that control to content oriented companies so those companies can extract more revenue from their customers. Consumers go with Microsoft because they can't get the content they want anywhere else. Like a many strategies, it's reasonable on paper, but real world considerations make it a lot harder than it sounds. Microsoft has to deal with a competitor with lots of vision for the future (Apple) and partners with no vision for the future other than to delay its coming as long as possible (the entertainment industry).

Without taking anything away from Bill Gates brilliance as a businessman, Ballmer had it a lot harder than Gates ever had. Bringing back Gates might improve discipline, or it might not. The company is inherently less focused than it was a decade ago.

What Microsoft really needs is new blood.

There are two choices: either it makes a serious bid to become a dominant player in consumer technology, or it becomes more conservative in how it throws money at grand strategies.

They're both reasonable options. I once heard an investment adviser say he had Procter and Gamble in his portfolio because if people stopped buying soap, most of his other assumptions about the world would probably be wrong as well. A company like P&G is continually creating new products, but nobody expects them to double their size every five years. You manage a company like that to produce profit, and growth is a welcome side effect. For years Microsoft ran things the opposite way: aim for growth and profits will come.

The right leader will take them one or the other path, although he'll face a lot of doubters, because neither of those choices is how Microsoft got where it is today. But bringing back Gates won't turn back the clock twenty years.

Re:Xbox Fiasco, Zune, Vista, Stock Price

[ozmanjusri]

I agree.

The open source community should support Ballmer. He's been our best evangelist for almost a decade.

Re:Xbox Fiasco, Zune, Vista, Stock Price

[rtb61]

To be fair. Gates remained as active chairman and was largely responsible for XP. People should remember that he had to go overseas in order for senior staff to be willing to talk or attempt to work with Ballmer in lieu of going around him to Gates.

Of course Ballmer is largely Gates fault and responsibility, without Ballmer's succesful manipulation of Gates, Ballmer would never have made to CEO of M$.

A big reason for Gates leaving M$ was the damage M$ was doing to Gates personal reputation and, strangely enough that damage was being caused by Ballmer abusive and arrogant behaviour as the CEO and his complete mishandling of M$.

M$ staff don't call Ballmer the 'billy' goat without due reason and a certain wry humour.

Re:Xbox Fiasco, Zune, Vista, Stock Price

[Hieronymus Howard]

Now compare with AAPL. Notice a difference?

Re:Xbox Fiasco, Zune, Vista, Stock Price

[Anonymous Coward]

Now compare with AAPL. Notice a difference? Yes. With a current P/E ratio of 38.1, we may look back at this period as the "Apple Bubble."

Re:Xbox Fiasco, Zune, Vista, Stock Price

[peragrin]

Not really no. MSFT doesn't have any profitable division except for windows and Office. no other diverse product is making enough money to support it self in the long term on it's own.

If MSFT keeps on buying up companies without making any real products the day windows or office becomes obsolete(IE ODF everywhere) is the day MSFT crashes hard. It will get torn to shreds by investors, leaving nothing left.

It will be spectacular.

MSFT can survive it if and only if they can get more than a handful of products that actually make money.

Re:Xbox Fiasco, Zune, Vista, Stock Price

[HardcoreWizard]

I may be naive, but it would actually be nice to have a CEO which focused on more ethical tactics, and actually tried to create products that were compliant. I would much rather have a Microsoft that would support real open standards, instead of a dying Microsoft that will make everyone using MS products stuck at crappy binary blob formats.

Re:Xbox Fiasco, Zune, Vista, Stock Price

[OpenSourced]

- Headcount has increased from 35,000 to 80,000

Is that supposed to be a good thing? After all, you have to pay them. And looking it against your other figures, you get that, by more than doubling the people, you just double the revenue and not even double the income. So the income generated per person has in fact diminished.

Re:Xbox Fiasco, Zune, Vista, Stock Price

[dhavleak]

MSFT doesn't have any profitable division except for windows and Office. SQL server, active directory, exchange, visual studio, share point, biztalk, windows mobile, MSN, live search to name a few. Even the xbox dudes have been making profits -- they're just a while away from recovering the initial investment. And the zune team isn't doing too badly either. Ultimately all these businesses are growing and need people. The acquisitions (danger, aquantive, viridian, bungie, ensemble and many more) add to the head count as well. (bungie is an independant studio again, but you get the point). These are real products with real customers. They're just not as visible as office and windows. There's also the research division which is also growing and the live mesh team etc.

.... is the day MSFT crashes hard. It will get torn to shreds by investors, leaving nothing left. It will be spectacular. Feel free to not conceal your glee if/when it happens :P

MSFT can survive it if and only if they can get more than a handful of products that actually make money. As you see from the list above, they understand this pretty well. Well enough to make an offer to buy Yahoo because they're not satisfied with the progress they're making there (and rightly so). And that brings us back to Ballmer -- he's got the gumption to admit that MS hasn't got the right online strategy/brands/customer-base/mindshare, and that they need some help in this area. It takes guts to do something like this -- something along the lines of Google buying youtube when they already had a competing but much less successful solution (google video).

Re:Xbox Fiasco, Zune, Vista, Stock Price

[PalmKiller]

Two splits in 5 years look good to me, and no big drops, I wish I had bought the stock back when it first leveled off. Nice feature that compare option under the interactive graph, it shows that microsoft is doing quite well.

Re:Xbox Fiasco, Zune, Vista, Stock Price

[nine-times]

That makes me wonder, is Microsoft's financial success/trouble follow the general tech-sector's success/trouble, or is the tech sector following Microsoft?

Re:Xbox Fiasco, Zune, Vista, Stock Price

[immcintosh]

Good GOD! Clearly Ballmer is responsible not just for Microsoft's downfall, but for a slump in the ENTIRE COMPUTER INDUSTRY! Burn him! BURN HIM!

Re:Xbox Fiasco, Zune, Vista, Stock Price

[afabbro]

They're in different industries. Microsoft is a software company. Apple is a fashion company.

Re:Xbox Fiasco, Zune, Vista, Stock Price

[Chris Burke]

In the absense of such laws, the the EU has taken actions against MS that get no promise of interoperability from the rest of the industry. They have saddled MS with regulatory oversight, fines, and forced them to sell IP at rates below what their competitors would charge.

Why yes, monopolies have different legal restraints than other companies, and when said monopoly breaks the law, the penalty applies only to them.

In the long run this solves nothing -- it just makes it likely that in the future we'll face the exact same problem, but from some company other than MS.

No, not enforcing the law would make it more likely that in the future we'll face the exact same problem, either from MS or from another company, because they'd know there's no penalty for breaking the law. Enforcing the law means that the next company after MS will be more likely to think twice before illegally abusing its monopoly.

I get your point that the current laws and the EU's decision don't address the greater underlying issues in a way that fixes the problem entirely, rather than just in the specific case of MS. That's true, but means nothing as to whether the EU's action against MS was appropriate. You may as well say that because the law as it stands does not address the underlying problems of violent crime, we should not prosecute a particular case of aggravated assault. That's nonsense. If the problem is that the law is not over-arching enough, the solution is not to enforce the law less.

Re:Will save on M$ office furniture bill

[smilindog2000]

I doubt it, but you never know how Wall Street will react. I've become more convinced lately that individuals like Bill Gates and Steve Jobs, and that guy who built Sony, are critical for stellar growth in high-tech companies. After David Packard left, HP floundered for years. I suppose Gates could revive Microsoft, much like David revived HP for a time, and Jobs has revived Apple.

However, it seems to me that the writing is on the wall: cheaper computer hardware means cheaper software. $200 PCs are a bad sign for Microsoft. Android built on Linux for cell phones is a bad sign for Windows Mobile. Losses in Xbox and other non-core divisions don't help, and defocus Microsoft from it's primary mission: Windows. I'm a big fan of Intel's Atom processor, and I suspect Intel can make the transition to cheaper computing, although with lower revenue. Microsoft... I'm not so sure.

No no no!

[EmbeddedJanitor]

I quite like to see MS going down the tubes.

Borg Icon

[TheNetAvenger]

The SlashDot Borg Icon for Microsoft needs to be Ballmer not Gates.

In Microsoft there are two sets of crowds, the Gates set and the Ballmer set.

The Gates set is more apt to give stuff to users, do things the right way, and has been the underpinnings of things MS has gotten right or had done right by the IT world as a whole. They tend to take what they do seriously, have pride in Microsoft and want it to continue to succeed for the right reasons, etc.

The Ballmer group are the business minded, make a buck, and screw you type of people. They step on each other, screw over other projects if it gains them something, and could give a crap about the IT world or even Microsoft itself in the long run.

When you see the 4 versions of Vista, this was the result of the Ballmer crowd and OEMs wanting a dirt cheap version. The Gates crowd kept NT as two roles, Desktop and Server, but sadly the Ballmer nuts won that war cause they thought it would make MS an extra buck.

Gates = technology and empowering.
Ballmer = dominance and money.

Sadly Gates assumes that because most businesses think like Ballmer that Ballmer is doing the right thing, when Microsoft could be structured more like Gate's foundation and not only help the IT world more, but be just as profitable.

I would love to see Ballmer retire and the idiots that think like him go as well.

Vista

[Toreo asesino]

After the disaster that has been Windows Vista Vista is the 2nd most used OS in the world for desktop PCs and laptops; I wonder how you would quantify it being a disaster (the fact you might dislike it not counting of course). You could claim it's not the most popular Windows to have come out, but disaster it is not. Money talks, bullshit walks, as they say.

Re:Vista

[Aranykai]

Lets see some numbers to back up those claims eh smarty pants?

Anyways, Vista may be "the 2nd most used OS in the world for desktop PC's", but how bout we compare its lifespan to ANY other OS release. I would still be using Windows 2000 if there werent a few select applications(mainly games) that I cant trick into running on it. I know there are several others out there who are the same.

People buy into the bullshit marketing. Its not that the product has merit, its that they are foolish enough to believe the promises made. How many millions of people buy those weight loss supplements, or male enhancement supplements? Because there are lots of people using something doesn't mean its a quality product.

Re:Vista

[webplay]

Sorry, but he is correct. Here are the Google Analytics stats from a top 200 U.S.-based general interest website from yesterday (May 5):
Operating System contribution to total:
1. Windows 91.86%
2. Macintosh 7.12%
3. Linux 0.69%
4. iPhone 0.13%

Versions of Windows:
1. XP 80.44%
2. Vista 14.65%
3. 2000 3.31%
4. Server 2003 0.80%
5. 98 0.68%

Re:Yes, but he won't

[icebike]

> He and Gates surely control enough stock to do as they please.

Not true: Check the holdings:
http://finance.yahoo.com/q/ks?s=MSFT

% Held by Insiders1: 13.42%
% Held by Institutions1:62.70%

If the institutions (banks, mutual funds, hedge funds, etc) want Steve out the door, he's gone.

Bill Gates' confidence, not the BoD

[quarrel]

Bill Gates is still the Chairman, the largest shareholder and founder.

Stevie B is the second largest shareholder.

Between Billy G and Stevie B they hold over 10% of the company (a lot for a large cap company).

Surely the only way Steve gets rolled as CEO is if Bill loses all faith in him, and given their long relationship this seems unlikely.

I doubt very much that in the face of a hostile Bill the board has any hope of removing him even if they, and their institutional shareholders are unhappy with his performance.

It seems exceedingly unlikely that on the back of these problems they'd get rid of him. If it ever got remotely near that, he and Bill would have a word and he'd "retire to spend more time with his family".

--Q

Re:Bill Gates' confidence, not the BoD

[Anonymous Coward]

Steve Jobs had a lot more than 10% when he was dismissed from Apple.

i hate balmer

[ionix5891]

but i have to give it to him (or microsoft) this was a great move, now yahoos own disgruntled shareholders will do the dirty work for Microsoft

i mean the whole takeover thing was a win win for microsoft

they managed to seriously knock their competitor of-track withoutt spending a penny

I hate Microsoft as much as the next guy but...

[Xest]

"Ballmer has been the big driver behind [the Yahoo] deal at Microsoft -- some would say to the point of obsession."

Yet when the bid failed he seemed quite able to drop it. I wouldn't call that obsession, obsession would've been continuing the bid until they got Yahoo no matter how costly and damaging to Microsoft. He knew when to quit and he did.

Of course then the summary goes on to bitch at him FOR dropping it. Make up your mind, was it bad that he continued as far as he did to the point the summary feels he deserves to be called obsessive over it or not?

It's hard to tell

[sentientbrendan]

whether some of these fiascos are Balmer's fault. Particularly, what happened with vista. It's very plausible that Vista died of feature bloat because Balmer didn't pay enough attention to it in the beginning; however, it's hard to tell from the outside who was really responsible.

Either way though, It's clear that some kind of shakeup needs to occur for Microsoft to continue to compete. I just don't see Microsoft being able to expand into new markets using the clumsy "throw money at the problem" approach that post-gates Microsoft has used. Money's an important tool for a company the size of Microsoft, but it can't cover up underlying problems, like a project that suffering feature creep, or a corporate culture that suppresses bottom up innovation.

Bill Gates seemed to run a much tighter ship overall, with a supposedly fairly "hands on" management style. However, it is true that Microsoft was a much smaller company under Gate's tenure, and I'm not sure he would be the man to put back in charge of the new Microsoft.

Re:He's Google obsessed

[vux984]

Most Yahoo and MSN are going south and Google is going north.

Its unfortunate. The last thing the world needs is a company with a monopoly on internet search, any company. And that includes google.

"Chair"man?

[Legrow]

Bill Gates is still the Chairman

If you think Bill Gates is the "chair"man, you must be new here...

Don't need Yahoo for a reason to can him.

[jcr]

MSFT has been underperforming the exchange indices for as long as Ballmer's been in charge. Now that MSFT is not, and will never again be a growth stock, it should be a dividend stock. Every billion dollars that MSFT pisses away on failures like the zune or the Xbox, is shareholders' money being wasted on Ballmer's ego trips.

-jcr

Re:Bidding for Yahoo was a tactic to cause chaos

[jcr]

Who do you think the biggest shareholders of microsoft are?

Banks, pensions and mutual funds, why?

-jcr

See that peak? Thats when I left...

[Anonymous Coward]

I left at the peak. Not just luck of course. Also not just smelling the coffee. It was a feedback effect. By leaving, someone not quite as talented took my place. And soon more people decided it was time to leave. Of course, it didnt just happen to me, but I really do feel if I had stayed things could have been different. Its just that, well, too many parasites and glommed on and it just wasn't worth fighting them anymore.

While I think Ballmer is certainly responsible, the problems really started much earlier. I blame Melinda for taking the edge off Bill, seriouly, he was a changed man after he got married. Balmer picked up the slack and quite frankly, hes an overbearing personality with no technical knowledge.

One of my heroes, Chris Peters had said that in order to have a successful product, you must reduce all dependencies. After he left, Ballmer changed the strategy: he actually told everyone to increase their dependencies on other teams. I think he must have been influenced by some of those self-help gurus who talk about the stages of maturity (dependence,independence, inter-dependence) and misapplied the lessons. Whatever it was, working at MS became a real chore and jerks, megalomaniacs and scammers began get power and the BS built up.
I doubt MS can ever recover from this period, its stock will never rise significantly again.

Re:He's Google obsessed

[Auckerman]

I agree that fundamentally monopolies are bad for consumers. In the case of Google, today, it's not a problem. Google isn't the default search engine in a clear majority of computers shipping today. That's quite telling. People have to seek Google out on purpose and chose to do so because Google works and works well. If you remember, Google rose to that position due to the arrogance of other search engines. Pay for top ranking, ads disguised as links in the ranks, eye candy over functionality. Then Google came along and said, why don't we try making a search engine first and generate revenue second. They are one of the few dot com companies that tried that and succeeded. Remember when ad words was first added and how "controversial" it was? It was ultimately accepted because Google MUST generate revenue somewhere in order to actually function.

In terms of online advertising, they may end up being a problem. All those ad words customers they generated ended up being very attractive to 3rd parties. Google will pay to put their customers ads up on your site, same basic market model as someone like doubleclick. It is here that a monopoly will end up costing consumers, given the proper board and CEO of Google. They have neither a monopoly there, nor the apparent corporate culture necessary to make this a problem. Yet.

This revenue is what Microsoft is interested in. In order to get there, Microsoft needs a functioning web site with an astronomical amount of users, to attract advertisers. Then they can take that customer base and start sharing it with 3rd parties, which attracts more customers. From what I understand, Yahoo has far better advertisement position than "Live" does. Combined with Yahoo, Microsoft would be in a position to make an advertisement company that could ultimately rival Google, doubleclick, etc. They failed because ultimately Yahoo's internal culture is against Microsoft. From what I can see, it's to the point that employees would have left the company in numbers significant enough that Yahoo would have ended up worthless. This is something the guys at MS didn't see happening. They assumed the amount of cash offered and the overall chance to rival Google in both search engine and advertisements would have been good enough for both management and employees. It clearly wasn't and now Microsoft understands that, which is why they recalled their bid and aren't chasing the hostile take over option.

Re:He's Google obsessed

[Ilgaz]

He doesn't get how Google or Yahoo gets success. They get success because there are purely oriented to services they provide and how a bigger audience they can reach.

Yahoo can spend months trying to make Yahoo Mail beta compatible with one of the fastest moving browser targets on planet, Safari (and Webkit). Same goes for My Yahoo beta which can easily be called a full feature RSS reader APPLICATION running from web browser.

Google guys do everything to keep compatibility with Safari/Firefox and even as a user, I know Safari isn't the easiest browser to code for.

What does Hotmail do? It suggests user to "UPGRADE IE version" to get better experience. Problem? It is/was Safari 3.1 for God's sake.

If they want success on Web, they should fire the first person to suggest IE for better experience, adopt the "Graded browser support" scheme of Yahoo, stop advertising joke like things like Silverlight OR make Silverlight 2 something that people will show Adobe as an example. For example, Silverlight 64bit edition for Linux/FreeBSD , actual MS release without using any puppets.

As you mention Google Android, you know Android syntax is based on J2ME since it is the most known, distributed, multiplatform thing on mobile space. Did MSN code ANYTHING for hundreds of millions of mobile devices having J2ME? Symbian? No. Why? Because they see every device not running Win CE as some sort of "enemy".

On the other hand, Yahoo Go is a full feature application written in J2ME, Youtube (Google) ships an excellent performing J2ME application to mobile devices.

It is not only Ballmer to be fired. It is those idiots at MSN who once dared to block standard WAP browsers except their MS WAP browser (old Sony GSM) from mobile hotmail. As far as I can see, that group of idiots are still active at MS.

Re:Yes, but he won't

[Lumpy]

and honestly that is when all good companies start the drain spiral. The men with vision and drive for the company no longer in charge but bean counters.

when the bean counters are driving the ship they only look 30-90 feet in front of the bow. The refuse to adjust course for any reason unless they see it within that 30-90 foot window. It's not cost effective to steer around the iceberg that is on the horizon. It's more profitable to keep steaming at it full speed.

The WORST thing for a company is to go public and have most of the stock owned by someone other than the principals that started the place.

Re:why?

[goombah99]

I think you are right that this is a power play. Call Yahoo's bluff and walk away. Now the share holders are left thinking I cold have had hard cash within 20% of my pipe dream about what this company is worth. Now I'm back to the pipedream. Which state do I prefer.

Before balmers intervention the pipdream valuation was rock solid. Every one thought it was realistic Someone someday would either pay that for yahoo or yahoo itself would generate income on that scale. If they did not they would not have invested in the first place. No one had to think about when that someday was coming or even if it was coming.

Now MS bid, and Yahoo desperately tried to find a white nite to counter offer.

No one else bid. Now MS withdrew theirs.

Sould searching time for yahoo investors. They are going to demand profits, not get them and in a year the company will run out of cash. The engineers MS covets will still be there, the company MS did not need will be cored out and bought for a song.

All that said. I don't think Monkey boy planned it that way at first given his string of high profile failures. But once the ball got rolling be probably realized the opportunity.

Inflation?

[HangingChad]

Ballmer took over in 2000. Here is Microsoft's stock performance since 2000:

I'd like to see that chart adjusted for inflation. Bet it tells an even more interesting tale.

Microsoft's corporate execution wasn't great before Ballmer got there, but since he took the reigns it's been positively dismal. There aren't many people who can run a multi-billion dollar software company into the ground, but he's managed it. Everything he touches turns to absolute crap.

Ballmer has been a complete failure in every single effort by Microsoft to create viable products outside of their core OS/office software/server software products.

I'd argue that he's turned Office into an expensive piece of bloatware. And Windows should have been replaced after XP with a more flexible and slimmer OS product.

Microsoft execution has been horrible and that includes their core profit centers. Instead of putting their efforts into producing the best software products available in the market (not the same as the most ubiquitous), Ballmer put his efforts into flying around trying to strong arm big cities and companies not to jump ship for Linux and OpenOffice.

Re:why?

[sexconker]

A long, long, long, time.

Google sells stock and ads.
Microsoft has actual products (bitch all you want about them - they do sell).

And there is no way in hell Billy Boy would ever let Google (or anyone else for that matter) buy out his company.

Re:why?

[Foofoobar]

Oh hell no... I say let him stay. A few more decisions like Vista, Zune and the DRM and Microsoft just becomes another Novell; the only two things they make that people really HAVE to have are Xbox and Exchange. Even Office is becoming optional now.

Don't Like Ballmer, But He's Winning...

[Nom du Keyboard]

I don't like Ballmer, but his Yahoo strategy is anything but a failure! Yahoo is in chaos. The shareholders are out hunting for Yang's head over this. They'd probably take a $29/share offer right now which is below Microsoft's original $31 offer. MS stock is up, while Yahoo's is falling like a stone back towards $19. Any Yahoo anti-takeover defense is now likely off the table forever, meaning that this game is hardly over. So to say that Ballmer should go over his "failure" simply indicates that Geeks are truly stupid when it comes to understanding how business works.

But we knew that already. That's why we don't make good CEO's, and often not even good managers.

Re:why?

[moderatorrater]

That was a very good post. Spot on analysis, beautiful understanding of the situation with added insight into what really happened. Plus, riddled with spelling mistakes that would make any slashdot editor proud.

I believe this post will be the one I get nostalgic about when I reminisce in the work camp while the robotic overseers aren't looking.

So if he's going he will need a new job

[infonography]

Running mate for McCain? following in the Dick Cheney tradition of dark lord of the underworld?

Take over for Castro in Cuba?

Still time for a new manager of the Olympic Games in China. (or compete in the 500m chair toss.)