Microsoft News Tracker

There was quite a surprise today as Microsoft announced that Jeff Raikes, president of the Microsoft Business Division (MBD) will be retiring in September and the replacement is Stephen Elop, current COO of Juniper Networks and former CEO of Macromedia before it was acquired by Adobe:

Microsoft Corp. today announced that, effective September 2008, Jeff Raikes, president of the Microsoft Business Division (MBD), will retire from the company following a nine-month transition to ensure a smooth transfer of his daily responsibilities and management of the division.

The company also announced that Stephen Elop, formerly chief operating officer (COO) at Juniper Networks Inc., has been hired as president of the Microsoft Business Division. Elop will start at Microsoft at the end of January and assume responsibility for the Information Worker, Microsoft Business Solutions and Unified Communications businesses — all previously led by Raikes. Bob Muglia, senior vice president of the Server and Tools Business, will move to report directly to Microsoft CEO Steve Ballmer and continue managing the Server and Tools Business. Between now and his retirement, Raikes will continue to serve as a member of the company’s senior leadership team responsible for developing and guiding Microsoft’s core business strategy.

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Before Juniper, Elop, 44, served as president of worldwide field operations at Adobe Systems Inc., where he was responsible for Adobe’s global sales organization and all customer-facing functions. Elop joined Adobe following the 2005 acquisition of Macromedia Inc., where he was president and CEO.

This change is interesting on a number of levels:

• Raikes had been touted as a possible successor to Steve Ballmer, not that Ballmer seems to be going anywhere soon. Perhaps that might be a motivation for Raikes’ leaving at this juncture now that Office 2007 has been shipped.
• Microsoft going outside the company for Raikes’ replacement is somewhat surprising, but aside from Elop’s other strengths, he has experience with one of Microsoft’s toughest competitors in the document and multimedia arena. Presumably all noncompete restrictions have expired.
• Bob Muglia and Server and Tools are long overdue for direct reporting instead of being lumped in with Office and MBS.