Market rejoices as Ballmer announces exit

by Sohini Bagchi    Aug 26, 2013

Steve Ballmer

“Steve Ballmer has finally done the best thing he can do for Microsoft - leaving!” tweeted an enthusiast after the announcement of Ballmer’s retirement from Microsoft in the next 12 months. The stock market immediately went up as analysts believe Ballmer’s departure will ultimately be a good thing for Microsoft and Twitter and other social media sites were flooded with messages of ridicule once the news became public. People at last had something to rejoice for the boisterous leader who presided over one deadly decade since 2000 – who failed to recognize that transformation is the only way to stay relevant in the new tech economy, a foundation that Bill Gates so intelligently built under his leadership.

Stuck in old times

Unfortunately many in the industry opine that under Ballmer’s watch the company became more inflexible towards its approach to new technology innovation. The problem was not with Ballmer’s intelligence which he anyway had in plenty, but his skills that were not the right fit for taking the company to the next level, technology underwent a sea change in the last ten years. He lacked an engineering background. He was not even a product whiz. Instead he had a business, sales, and marketing focus. “And you forget that Steve Ballmer was the sales guy that helped make Windows what it is in the first damn place,” tweeted @robertmclaws.

Experts believe this kind of vision is fine to keep the business going but not adequate for a tech giant that needs to transform itself based on market and customer needs. As a result, Microsoft remained quite stagnant in recent times. Despite several criticisms, Ballmer still stayed on in his job, as insiders said he tried to make a graceful exit as much as he could do, or else he would have been forced out. Even though some still speculate whether he has made the decision on his own, or was he forced out? A tweet @linuxuser3 mentions, “Why is he leaving now? There’s still something of the company left yet to ruin!”

Still a rich man!

However, according to Fortune: “While Ballmer has had a rocky tenure as CEO… it has been enormously entertaining to watch, largely due to his bombastic personality, relentless salesmanship and endless quotability. ” In his memo to employees on Friday announcing his plans to retire, CEO Steve Ballmer said, “I cherish my Microsoft ownership, and look forward to continuing as one of Microsoft’s largest owners.” Indeed, Ballmer owns quite a bit of stock in the company and it will make him a very rich man when he finally departs.

In fact, the surge in Microsoft’s share price following the announcement added some $560 million in value to Ballmer’s 333.3 million shares of Microsoft stock. “Looks like Ballmer finally figured out how to make Microsoft stock go up,” tweeted @spolsky.

Twitterer @ggoodale tweeted, “I can only hope my retirement announcement will be as profitable for me as Steve Ballmer’s was.”

That amount reportedly makes Ballmer the 51st richest man in the world and the 22nd richest person in the US. Although the amount of money is insignificant in comparison with Microsoft co-founder and chairman Bill Gates. (He is currently the world’s richest man at the moment with a net worth of $72.7 billion), Ballmer’s stake in Microsoft is worth 56 percent more since he took over as CEO in 2000.

What next?

So, what will Ballmer do with all of that money? Will he give most of it away to charitable causes, like Gates or will he use it to invest in other tech ventures?  In an interview with ZDNet.com, Ballmer claims he has no idea of what he plans to do next, saying that he won’t have any time to think about that until Microsoft selects someone to replace him as CEO.

Meanwhile, an executive at Microsoft named Roy Levin accidentally sent this email to the entire staff of Microsoft in response to CEO Steve Ballmer’s company-wide email announcing his retirement, as posted in Huffington Post. “The market likes the news which is interesting, given that the successor isnt known. Now the speculation shifts into high gears.”

There are many contenders for the role, and experts believe it should be outside of Microsoft’s comfort zone this time, and so the possibility of taking in a key executive poached from Google, Facebook, AOL or Yahoo is not ruled out by many.

We need to wait and watch out this space!