Microsoft today announced a major shakeup in the continually troubled Entertainment and Devices Division via a letter from Steve Ballmer to employees:
Robbie Bach and J Allard, founding fathers of Microsoft’s Entertainment & Devices Division, are leaving the company as part of a broader restructuring that will give CEO Steve Ballmer more direct oversight of consumer businesses including Microsoft’s struggling mobile unit.
The changes — a major management reorganization, even by Microsoft’s standards — will reshape the division leading the company’s battles against Google, Apple, Sony, Nintendo and other rivals in the hard-fought consumer technology market.
Bach, 48, president of the division since its inception five years ago, isn’t slated to be replaced. That will effectively dissolve the division’s current structure and leave the existing Xbox and Windows Mobile leaders to report to Ballmer starting in July.
Microsoft is describing Bach’s departure as a retirement. He said the decision was his own, and he wasn’t encouraged to leave. He’ll remain at Microsoft through the fall, to ensure a smooth transition.
Speaking with TechFlash, Allard said his decision was unrelated to the recent cancelation of the "Courier" dual-screen tablet project that he had championed inside the company. Allard said he doesn’t plan to work for Apple, Google or any other Microsoft rivals. After 19 years at the company, he said, he wants to devote more time to his personal interests, particularly adventure sports.
The separation of the Windows Mobile unit from the current Entertainment & Devices reporting structure also reflects the company’s efforts to connect its mobile initiatives with a wider range of products, including its online services and traditional software.
Don Mattrick, the senior vice president in charge of Microsoft’s Interactive Entertainment Business, will report directly to Ballmer as part of the management changes, as will Andy Lees, the senior vice president who leads the Mobile Communications Business.
Windows Web Services is born. Antoine Leblond, who has been Senior Vice President of the Office Productivity Applications Group, is moving to a new role: Senior Vice President for the Windows Web Services team. What is Windows Web Services? Good question. CEO Steve Ballmer’s e-mail describes it as “integral Windows services that today deliver updates, solutions, community and depth information for the Windows consumer.” Leblond will be reporting directly to Windows/Windows Live President Steven Sinofsky.
Office gets a new engineering chief. Kurt DelBene, Senior Vice President of the Office Business Productivity Group, is now head of all of the engineering responsibilities for the Office business.
Former Live Platform Services head David Treadwell moves out of the Windows division and into the Interactive Entertainment Business (the part of Microsoft that oversees Xbox and video games).
Xbox has finally started making money after the billions poured into it, but the Windows Mobile story was acknowledged even by Microsoft to be a vast missed opportunity verging on a disaster. Microsoft doesn’t like to lose markets where they used to have a commanding presence. The other entertainment products are yawners (e.g. Zune), but Mac Office is still a money maker and customers still love Microsoft keyboards and mice. Unfortunately they are the smallest and least visible part of the E&D menagerie.
Microsoft’s Steve Ballmer and Robbie Bach delivered the keynote last night at the 2010 Consumer Electronic Show in Las Vegas and it was the usual mixture of self-congratulatory boosterism and product and technology demos. Here is my list of highlights:
After a report on how well Windows 7 is selling, there were the PC demos including a prototype Hewlett-Packard slate PC that the technical press was pining for.
It looks like a touch enabled netbook to me and while it may have a niche, I suspect I would be screaming for a keyboard (or at least a stylus) in under a minute of usage. Perhaps more interesting were the ultrathin Lenovo A300 laptop with a 21.5" screen and the Sony VAIO home entertainment notebook with a 24" screen. How big does a laptop have to get before it becomes a single element desktop?
HP is making Bing the default Web search engine and MSN the default home page on all their PCs in 42 countries.
Ballmer put the usual lipstick on this pig and Robbie Bach appeared later to flog upcoming games (including another lucrative Halo version) and tout Project Natal, the motion sensing technology that will appear later this year to replace the standard controllers for some games.
Bach also announced Mediaroom 2.0, the latest version of Microsoft’s IPTV offering for service providers which now supports PCs and smartphoes as well as set top boxes and Xbox consoles for TV viewing.
Microsoft really did not have much of its own to show again this year. I am almost beginning to miss the goofy Bill Gates future technology skits.
Microsoft CEO Steve Ballmer gave his maiden Consumer Electronic Show keynote yesterday and if it was just as soporific as Bill Gates’ past performances, it mercifully skipped the goofy "future tech" skits that Microsoft’s PR folks used to put Gates through. In a nutshell, the message was "Windows 7, Windows 7, Windows 7" plus the obligatory appearance by Microsoft’s Entertainment & Devices chief Robbie Bach to once again whistle past the graveyard and say that everything on his patch was swell.
“I’m thrilled to announce the availability of the Windows 7 beta, which is on track to deliver simplicity and reliability,” Ballmer said. “Windows 7 and Windows Live are part of an incredible pipeline of consumer technology that is making it easier than ever for people to communicate, share and get more done.”
The beta version of Windows 7, Microsoft’s next-generation PC operating system, can be downloaded today by MSDN, TechBeta and TechNet customers. Consumers who want to test-drive the beta will be able to download it beginning Jan. 9 at http://www.microsoft.com/windows7.
Microsoft also announced the global availability of Windows Live, a free suite of communications and sharing applications.
Actually that’s not all the ten thousand different Windows Live applications, but just Windows Live Essentials, the bundle of Windows applications you will have to download to give Windows 7 the same functionality as Windows XP. In which respect there was good news for Dell customers:
In February, to offer a comprehensive experience for consumers to connect, share and personalize their content, Dell will offer preloaded Windows Live Essentials (a free suite of applications for instant messaging, e-mail and photos that complement Windows Live on the Web) and Live Search on a majority of its new consumer and small-business PCs globally.
No word on how much money changed hands, but bear in mind that Dell is paying to put Windows on their PCs so with this deal they are merely getting a discount for also preloading Live Essentials and Live Search. I am sure Microsoft’s lawyers are making sure it is a separate accounting entry however.
Also announced was the Verizon mobile search deal leaked yesterday:
Under a new five-year relationship that covers mobile search and advertising, Verizon subscribers in the U.S. will be able to use Live Search to search for local business and shopping information; access maps and directions; perform general Internet searches; and find ring tones, games, wallpaper and other online mobile products and services.
More succinctly, Microsoft’s Live Search will become the preferred Web search on Verizon mobiles.
There was a bit of a kerfuffle in July when it was revealed that Microsoft Entertainment and Devices Division President Robbie Bach sold $6.2 million in Microsoft shares in the run-up to the announcement of the billion dollar band-aid for defective Xbox 360 units. Executives often use scheduled stock sales to avoid any appearance of insider trading and still pick up some walking around money, but Bach’s sales were unscheduled. Now it turns out he actually sold an additional $3 million worth of shares that somehow fell through an insider sale reporting crack: