Foley on Microsoft

A Gates-less Microsoft

The house that Gates built? More like a house divided.

July 1 marks the one-year anniversary of Microsoft Chairman Bill Gates relinquishing his duties as a full-time employee. Although Gates' change in status appeared seamless to the outside world, if you look closely you can see cracks in the foundation of the house that Gates built.

At Microsoft, there have long been two main management camps: Friends of Bill (FOB) and Friends of CEO Steve Ballmer (FOS). When Gates moved aside to focus on the Gates Foundation, I expected a mass exodus of the FOB and more rewards and promotions for the FOS. Slowly but surely, this has started happening, with more folks with MBAs and sales pedigrees -- like Chief Operating Officer Kevin Turner -- moving into more visible roles. Those with developer and engineering chops are becoming less visible or leaving altogether; prominent examples of this trend include ClearType champion Bill Hill and former robotics chief Tandy Trower.

The FOB/FOS divide is more than a simple difference in styles. It also highlights the difference in priorities and loyalties at Microsoft -- a schism seen in comments on the blog of the anonymous 'Softie "Who 'Da Punk," aka Mini-Microsoft. As Microsoft began whittling away at its promised headcount reduction of 5,000 employees, posters on Mini-Microsoft got into some serious -- and sometimes very hostile -- infighting.

"Why is Microsoft continuing to waste so much money on Xbox and Zune instead of investing it in the Windows client and in Office?" some commentators asked. Others fought over the sanity of Microsoft continuing to pour money into its red-ink-stained Online Systems Business instead of the enterprise products that have fueled the company's growth. Windows Mobile was also hugely contentious. Even now, the most loyal Microsoft fans can't fathom what the heck is going on in that division and when, if ever, Microsoft will get its act together and start looking timely and relevant in the mobile market.

Debate about Chief Software Architect Ray Ozzie made its way into the Mini-Microsoft comments, too. Ozzie has remained as publicly invisible as ever. Some folks had theorized that Ozzie intentionally kept a low profile while Gates was still a full-timer so as not to step on Gates' shoes, and that Ozzie would emerge as a public prognosticator after July 1. For the most part, it still hasn't happened.

I've talked to a number of 'Softies who say Ozzie is a key mover and shaker behind the scenes, influencing Microsoft's growing emphasis on interoperability and encouraging teams to cooperate. Meanwhile, other employees say the company feels rudderless from a technical perspective without Gates. More than one poster on Mini-Microsoft wondered aloud what Ozzie has been doing since taking the reins as chief software architect three years ago. Even his pet project, Live Mesh, is still unfinished and not very well understood by people outside or even inside the company, the blog commentators noted.

One influence Ozzie has had is Microsoft's newfound insistence on secrecy. Ozzie has been adamant that Microsoft not share details about products before those products are ready to launch unless it's absolutely necessary. The Windows, Windows Mobile and Office teams have all stepped up their vigilance against the public promotion of vaporware -- as well as against the sharing of roadmaps, actual ship dates and other information wanted and needed by partners and customers.

I don't think it's fair to grade Ozzie for the changes in the past year, as Microsoft is Ballmer's baby, not his. But I will say that over the past year, Microsoft has become, more than ever, a house divided.

What's your assessment? Is Microsoft doing better or worse without Gates representing the company full-time?

About the Author

Mary Jo Foley is editor of the ZDNet "All About Microsoft" blog and has been covering Microsoft for about two decades. She has a new book out, Microsoft 2.0 (John Wiley & Sons, May 2008), about what's next for Microsoft in the post-Gates era.

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