Wednesday, 28 August 2013

Exit of Steve Ballmer; time for Private Equity to step in



As a Bloomberg West presenter pointed out on 26 August, the share price of Microsoft when Steve Ballmer became CEO was higher than when he announced his departure.  It was clear from the many guest commentators that he didn’t get it and as one said, “The ships have sailed without them on”.

This blog writes about sailing pointing out successful launches (Net-a-porter, Salesforce.com, Red Hat) analysing how they did it, applying unique ‘rules’ of doing business on the internet wave.  Microsoft being the poster child of an era past (passing), the exit of Ballmer finally draws attention to the end of the PC-LAN cycle which probably peaked some 10 to 15 years back.  Industry insiders already know this but this announcement may be the clarion call to the rest of the industry to that fact.  In software, open source, the software of the internet, is making inroads though still a challenge in Asia.  It will enter mainstream soon aided by news of the jump of 9% in Microsoft’s share price on the day of the announcement.  This is the era of the internet.

The analysts further commented that Microsoft misjudged tech trends, struggled in tablets, smart

phones and was late in the Cloud and Search but these are really internet-driven devices and internet services.  Microsoft, they say must transform; the culture needs a reboot, the traditionalists need to be rotated out and fresh blood, presumably those in tune with market needs and tech trends of today brought in.  Change as we all know is a most difficult endeavour.  While I am not a great fan of Private Equity, it is time to call them in.  They can catalyse such a drastic change of.dna.

And in my opinion, the next CEO must come from the internet industry. 




©Chen Thet Ngian, internetbusinessmodelasia.blogspot.com (2013).  Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Chen Thet Ngian and internetbusinessmodelasia.blogspot.com with appropriate and specific direction to the original content.

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