Steve Ballmer lost Bill Gate’s support recently, but Ray Ozzie’s in 2010

Steve Ballmer’s announced departure from Microsoft (see Microsoft’s Ballmer stepping down in next 12 months) is not a surprise to those who have been watching the company closely. I’ve been arguing for months that he would be out of Microsoft as soon as Surface and the Windows Phone were confirmed as disastrously late and universally unloved.

A great deal of discussion in the technosphere since Friday’s announcement has centered on a discussion on who in the Microsoft organization knew that Microsoft’s strategy wasn’t working, and when. Numerous people have pointed a finger at the departure of the former CFO, Peter Klein, who jumped ship in April after four years in that role. Obviously, Klein was very close to the financials at that point, and could have been looking down the pipeline to the second quarter results that led to a $900 million write down of Surface tablets (see Microsoft takes $900M write-down on Surface, but Office 365 looks strong). But when there is a huge failure of vision, as in the case of Ballmer missteps in trying to two-step into the post-PC world, the best bellwethers are visionaries. In this instance, that is demonstrated by the departure of Ray Ozzie, back in 2010.

Ozzie was the founder of Iris, which built Lotus Notes for Lotus, and was ultimately acquired, and the technology made billions for IBM. He then started Groove Networks, which was acquired by Microsoft in 2005: some said that Bill Gates bought it just to get Ray Ozzie to come to Microsoft. The product was wound down after a few years, and Ozzie rose to become the Chief Technical Officer of Microsoft, and one of the forces pushing a reluctant Microsoft into the post-PC world that he saw much more clearly that Ballmer and others.

A few months prior to Ozzie’s departure, in January 2010, he wrote a memo called Dawn of a New Day, in which he presaged a very changed world, one in which the complexities of the computing model that Microsoft had developed would be a liability not an asset. Ozzie suggests that Microsoft had made real progress in the five years since he joined — enumerating Bing, Office 365, Windows Azure, and other innovations — but then he starts to talk about the then-future, our today:

And so at this juncture, given all that has transpired in computing and communications, it’s important that all of us do precisely what our competitors and customers will ultimately do: close our eyes and form a realistic picture of what a post-PC world might actually look like, if it were to ever truly occur.  How would customers accomplish the kinds of things they do today?  In what ways would it be better?  In what ways would it be worse, or just different?

Those who can envision a plausible future that’s brighter than today will earn the opportunity to lead.

[...]

Today, in my own dreams, I see a great, expansive future for our industry and for our company – a future of amazing, pervasive cloud-centric experiences delivered through a world of innovative devices that surround us.

[...]

And yet, even in the presence of so much uncertainty, I feel an acute sense of hope and optimism.

When I look forward, I can’t help but see the potential for a much brighter future:  Even beyond the first billion, so many more people using technology to improve their lives, businesses and societies, in so many ways.  New apps, services & scenarios in communications, collaboration & productivity, commerce, education, health care, emergency management, human services, transportation, the environment, security – the list goes on, and on, and on.

We’ve got so far to go before we even scratch the surface of what’s now possible.  All these new services will be cloud-centric ‘continuous services’ built in a way that we can all rely upon.  As such, cloud computing will become pervasive for developers and IT – a shift that’ll catalyze the transformation of infrastructure, systems & business processes across all major organizations worldwide.  And all these new services will work hand-in-hand with an unimaginably fascinating world of devices-to-come.  Today’s PC’s, phones & pads are just the very beginning; we’ll see decades to come of incredible innovation from which will emerge all sorts of ‘connected companions’ that we’ll wear, we’ll carry, we’ll use on our desks & walls and the environment all around us.  Service-connected devices going far beyond just the ‘screen, keyboard and mouse’:  humanly-natural ‘conscious’ devices that’ll see, recognize, hear & listen to you and what’s around you, that’ll feel your touch and gestures and movement, that’ll detect your proximity to others; that’ll sense your location, direction, altitude, temperature, heartbeat & health.

Let there be no doubt that the big shifts occurring over the next five years ensure that this will absolutely be a time of great opportunity for those who put past technologies & successes into perspective, and envision all the transformational value that can be offered moving forward to individuals, businesses, governments and society.  It’s the dawn of a new day – the sun having now arisen on a world of continuous services and connected devices.

And so, as Microsoft has done so successfully over the course of the company’s history, let’s mark this five-year milestone by once again fearlessly embracing that which is technologically inevitable – clearing a path to the extraordinary opportunity that lies ahead for us, for the industry, and for our customers.

And then, a few months later, he left Microsoft. (He has started Talko.) For the simple reason that he couldn’t inspire the company to move into the future fast enough, because people like Ballmer believed the transformation of our world would be slower and Microsoft’s dominant position would be less radically disrupted that has occurred.

The line that stands out like a condemnation of Ballmer is this:

Those who can envision a plausible future that’s brighter than today will earn the opportunity to lead.

The skunk in the henhouse is ultimately Ballmer, though. The man who said these things:

D8 conference, 2010, on the future of the PC  “I think that people are going to be using PCs in greater and greater numbers for years to come. But I think PCs will look different … they’ll evolve. They’ll get smaller … they’ll get touch … their innards will change. The real question is, ‘What is a PC?’ Nothing that’s done on a PC today will get less relevant tomorrow. I think there will exist a general-purpose device that does anything you want, because people don’t want multiple devices, or can’t afford them.”

USA Today CEO Forum, 2007, regarding the iPhone: “There’s no chance that the iPhone is going to get any significant market share. No chance. It’s a $500 subsidized item. They may make a lot of money. But if you actually take a look at the 1.3 billion phones that get sold, I’d prefer to have our software in 60% or 70% or 80% of them, than I would to have 2% or 3%, which is what Apple might get.”

Email to all employees, July 2008, on battling Google in search: ” In the coming years, we’ll make progress against Google in search first by upping the ante in R&D through organic innovation and strategic acquisitions. Second, we will out-innovate Google in key areas—we’re already seeing this in our maps and news search. Third, we are going to reinvent the search category through user experience and business model innovation. We’ll introduce new approaches that move beyond a white page with 10 blue links to provide customers with a customized view of their world. This is a long-term battle for our company—and it’s one we’ll continue to fight with persistence and tenacity.”

Microsoft Town Hall, 2013, regarding Surface over-projections: “We built a few more devices than we could sell.”

These are up there with Ken Olsen’s boneheaded pronouncement, “There is no reason for any individual to have a computer in his home,” or Lord Kelvin saying “Heavier-than-air flying machines are impossible.”

One additional wrinkle that has emerged over the weekend is that Ballmer’s departure was rushed, as the wording in his bye-bye email seemed to imply, as I wrote last week. Kara Swisher has discovered through back channel discussions that in fact, yes, the timing of Ballmer’s departure had been accelerated significantly:

Kara Swisher, Ballmer Departure From Microsoft Was More Sudden Than Portrayed by the Company

While the decision to go seems to have technically been Ballmer’s, interviews with dozens of people inside and outside the company, including many close to the situation, indicate that he had not aimed to leave this soon and especially after the recent restructuring of the company that he had intensely planned.

Instead, sources said Ballmer’s timeline had been moved up drastically — first by him and then the nine-member board, including his longtime partner and Microsoft co-founder and chairman Bill Gates — after all agreed that it was best if he left sooner than later.

That was due to a number of increasingly problematic issues on the immediate horizon — including a potentially nasty proxy fight, continued business performance declines and, perhaps most of all, that Ballmer’s leadership was becoming a very obvious lightning rod.

Swisher also points out that Ballmer’s bye-bye email makes no mention of Bill Gates, his partner at Microsoft for decades, which suggests that it was Gates that lowered the boom on Ballmer. The Microsoft announcement about Ballmer’s departure also was lacking any great praise for the departing CEO.

Ballmer will be remembered as a denier, a bombastic showman, and the CEO that sailed the company from a 1999 market capitalization of $600 billion to last Thursday’s $270 billion. The final indignity is that the stock jumped 7.3% on the news of his departure, making him an additional $786 million richer.

Relevant Analyst
Stowe Boyd

Stowe Boyd

Lead analyst, future of work Gigaom Research and stoweboyd.com

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