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Microsoft Reorganizes Windows Group

Microsoft Corp. announced a broad reorganization Thursday of the unit that produces its flagship Windows operating system, two days after the company said the new consumer version of Windows would not be ready for the holiday season as planned.

The Redmond-based software maker said the changes are aimed at helping improve its online strategy. Companies such as Google Inc. and Yahoo Inc. are developing Internet-based products that pose a threat to Microsoft's desktop-bound Windows and other programs.

The company said a reorganized Platforms and Services division will be made up of eight new and existing groups, including the Windows and Windows Live Group, led by Steven Sinofsky, who currently heads development of company's Office business software system.

Other groups will focus on core operating system, online business products, and the servers and software tools businesses.

As previously announced, Jim Allchin, co-president of the Plaforms and Services division, will retire next year. Until then, he and co-president Kevin Johnson will continue to lead the division, while Sinofsky will focus on planning future versions of Windows.

Last September, Microsoft announced a restructuring -- aimed at reducing bureaucracy and improving the company's ability to compete with Web-based rivals -- that moved the company's seven business units into three divisions.

Microsoft shares fell 38 cents, or 1.4 percent, to $26.77 in afternoon trading on the Nasdaq Stock Market.

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