Saturday, Jun 25, 2016
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Microsoft CEO needs Windows 7 to go well

SEATTLE - Microsoft Corp. Chief Executive Steve Ballmer is putting his reputation on the line with the launch of the new Windows 7 operating system Thursday.

The 53-year-old showman, now in his 10th year as CEO, took personal responsibility for Windows 7 after the mess of its predecessor Vista, and cannot afford another slip-up.

A botched $45 billion bid for Yahoo Inc. last year, which blitzed Microsoft's stock price, left some investors questioning whether Mr. Ballmer is the right leader for the world's largest software company.

"He's a player-friendly coach; the players love him," said Bill Smead, chief executive of Smead Capital Management of Seattle, whose firm holds about 340,000 Microsoft shares. "The problem is, he's not a shareholder-friendly coach."

Microsoft's shares are now worth about half what they were 10 years ago, Mr. Smead noted.

Mr. Ballmer, despite his fist-pumping and high-volume leadership, has not lived up to his goal of creating a significant third business beyond Microsoft's two cornerstones, Windows and the Office suite of applications, which dominate the global PC market.

Microsoft has brought out the Xbox game console, mobile phone software, the Zune digital music player, and Bing search engine, but does not yet have a clear winner akin to Apple Inc.'s iPhone or Google Inc.'s search ad business.

Critics say Mr. Ballmer has concentrated on business customers at the expense of the consumer.

"He's so focused on corporate, and corporate is just not buying right now," said technology analyst Rob Enderle of the Enderle Group. "Maybe the CEO they need is one with a passion for the consumer side. He hasn't destroyed the company, but it clearly is not at the top of its game."

Mr. Ballmer has been Microsoft's CEO since 2000, but really grasped the reins last year when co-founder and Chairman Bill Gates retired from day-to-day involvement in the company.

The son of a Ford Motor Co. manager from Detroit, Mr. Ballmer was brought in by Mr. Gates - whom he knew from Harvard University - as Microsoft's first business manager in 1980.

His stocky ebullience was always the foil to Mr. Gates's quieter intensity, although it has sometimes gone too far, gaining him the nickname "Monkey Boy."

Despite his faults, the lack of shareholder revolt makes it likely Mr. Ballmer will remain CEO.

"In the investor base, I don't see the angry people with pitchforks out for [Mr.] Ballmer at this point," said Kim Caughey, senior analyst at Fort Pitt Capital Group, which holds Microsoft shares.

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