It’s common knowledge that Microsoft’s board of directors forced CEO Steve Ballmer to expedite his resignation, and the timing couldn’t come any sooner. Why? Well, a big reason is because Steve Balmer really sucks as a CEO. I don’t think I’m being overly critical — I think I’m being a realist.
Cry me a river: Steve Ballmer’s long-awaited goodbye:
Word on the street is that the search to replace Ballmer as CEO has come down to well-respected Ford CEO Alan Mullaly, who did a wonderful job turning Ford around, and Satya Nadella, head of Microsoft’s cloud computing division. Ahh, the classic internal/external debate! Should Microsoft promote a homegrown talent, or should it look to bring in a CEO with a fresh new perspective?
My opinion on this matter obviously doesn’t matter, but if I had to make my choice, I’d pick Mullaly. For one, Microsoft needs an outsider who can see the world from another perspective – namely one that deems Microsoft to have a soon-to-be failing business model. The problem with Microsoft is that they think too highly of themselves, really. Although they turn a tidy profit seemingly every quarter, those profits are centered on businesses that don’t trend well into the future. Does anyone really believe that Office can continue to be the bread-winner for Microsoft, especially when services such as Google Docs and Apple iLife/iWork are completely free? When mobile usage is up-trending with every iPad, iPhone, or Android sold? Scarier even is the fact that Apple just made the move to make all future operating system releases completely free.
Here’s a look at how Microsoft has made their money from June 2012 to June 2013:
57% percent of their revenue is Office and Windows, software that is offered completely free by their competitors (as loss leaders, probably). How can that trend continue? What’s even worse is the 13% that accounts for “Entertainment & Devices”, probably made up mostly of xbox with a tiny bit of Surface sales, if any. Does anybody truly believe that the future of gaming is a box with a CD slot in it? That is ludicrous. The future of gaming — all the young talent, money, time, and investment — is going into App Stores. I don’t mean the Apple App Store, per se, but online app stores in general. See, the future of gaming is not a box at all. It is networking and connecting through wireless devices that I already own. I should be able to download an app on my phone and be able to play that game on my TV. It’s as simple as that. To have such a big portion of a companies sales based around a concept like that is sad. To make matters worse, I guarantee the next CEO of Microsoft continues to invest in the things that are making money right now – such as xbox, Office, and Windows, rather than take a big-picture view of their profits.
To hell with the future!
Ahh, well here’s a sign of Microsoft’s innovation: