Microsoft aims to power mobile effort in major overhaul

Thu Jul 11, 2013 7:52pm EDT
 
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By Alexei Oreskovic

SAN FRANCISCO (Reuters) - Microsoft Corp launched its biggest internal overhaul in five years to streamline the development of products from Windows to tablets, hoping to catch nimbler rivals in mobile and cloud computing.

Lack of coordination and infighting have hurt innovation within the $74 billion revenue, 98,000-employee organization, which hopes to accelerate the design of products that appeal to a new generation of users more accustomed to smartphones and tablets than laptops or desktop PCs.

Some analysts see Thursday's moves, which include centralizing business-oriented functions such as marketing and research expenses under separate units, as helping shore up Ballmer's control over the sprawling corporation.

Removing major responsibilities for profit and revenue accounting allows the main divisions to focus on innovative products and eliminates the fiefdoms - Windows, Office for instance - that may have encouraged infighting in recent years, analysts said.

"You don't do a major reorganization like this unless you have some serious problems," BGC analyst Colin Gillis said. "It consolidates power around the CEO."

Development of Windows will now be folded into one group headed by Terry Myerson. He had previously focused only on Windows Phone and now has responsibility for tailoring the flagship operating software for devices ranging from the traditional PC to tablets and gaming consoles.

Julie Larson-Green, previously co-chief of the main Windows division, will oversee a new division charged with all hardware devices, from the Surface tablet to the Xbox.

Nearly all of the most senior managers have a new role after the reorganization, which did not include any major new hires.   Continued...

 
Microsoft CEO Steve Ballmer gestures during his keynote address at the Microsoft "Build" conference in San Francisco, California June 26, 2013. REUTERS/Robert Galbraith