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Chart: Microsoft's performance under Gates vs. Ballmer

By | June 4, 2010, 3:52pm PDT

Summary: Microsoft has been treading water for a decade, but here is a chart that provides a great visual of how the company’s value skyrocketed under Bill Gates and then flattened when Steve Ballmer took over.

Honestly, it’s surprising that Steve Ballmer hasn’t come under more fire during the past decade for Microsoft’s lack of innovation, dearth of new hit products, and a stock price that has continued to tread water.

However, those issues and Ballmer’s plan to keep milking Windows and Office rather than push forward and look for the next big advances in personal computing may finally be catching up with him.

The graphic below (created by Erik Pukinskis) charts the market value of Microsoft during the past two decades, comparing the CEO reigns of Bill Gates and Steve Ballmer. You have to be a little bit careful with this chart. It’s not completely to scale. Notice that the areas between 0 and 5 and 5 and 20 are much larger than the ones between 20 and 40 (and even this between 40 and 60). This gives a little bit of an exaggerated sense of how much Microsoft grew under Gates.

Nevertheless, it’s pretty amazing how all of the growth happened while Gates was CEO and then things stagnated as soon as Ballmer grabbed the reigns. Of course, it’s also important to keep in mind that the Gates-Ballmer hand-off coincided with Microsoft’s big antitrust case with the U.S. government. However, even after the dust settled from that, Microsoft has continued to struggle.

To read about the criticism of Ballmer that is starting to bubble up, take a look at these recent posts:

ZDNet’s Ed Bott has also penned a rebuttal of this line of thinking in his article, A closer look at Microsoft’s ‘lost decade.’

Is this criticism of Ballmer over-blown or long overdue? Jump in the discussion below to let us know your take.

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Topics

Performance, Steve Ballmer, Microsoft Corp., Performance Management, Human Capital Management, Human Resources, Workforce Management, Jason Hiner

Jason Hiner is the Editor in Chief of TechRepublic. He writes about the products, people, and ideas that are revolutionizing business with technology.

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Jason Hiner

Jason Hiner has nothing to disclose. He doesn't hold investments in the technology companies he covers.

Biography

Jason Hiner

Jason Hiner is the Editor in Chief of TechRepublic, an online trade publication and peer-to-peer community for IT leaders. He is an award-winning journalist who examines the latest trends and asks the big questions about the technology industry. He previously worked as an IT manager in the health care industry.

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Steve's doing Grrreat!
symbolset 15th Nov
I want him to stay right where he's at, doing what he's doing.
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It looks suspiciously like MS's growth was already flattening in 99.
Zogg 4th Jun 2010
So it looks more likely that BG "jumped ship" when he realised that MS could no longer keep growing like it had been. This is contrary to the article's implicit suggestion that "Gates = Growth" and "Ballmer = Stagnation".
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Like him or not
Cylon Centurion 4th Jun 2010
@Zogg

Gates knew what he was doing. He is a very smart man.
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Well, Take the Log chart and see the diff
Uralbas Updated - 4th Jun 2010
Its worse than you imagine. The Author of this article was being nice with Balmer.

Balmer has no clue what tech is about. Balmer has no foresight. Today he stated that PC's will not be replaced by Tablets. Steve Jobs in this respect think so, I respectfully disagree with both. Tablets may come for a while like netbooks did but replace a notebook or desktop, very unlikely.

What will end up happening is your cellphone will replace both your laptop and desktop and interfaces will do the rest. That's the real future.
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RE: Chart: Microsoft's performance under Gates vs. Ballmer
dave95. Updated - 5th Jun 2010
@Uralbas

I don't think Jobs was saying the Tablet or iPad will replace the PC (at least not anytime soon); just that most people's "PC" use today don't require a full blown desktop of Laptop (trucks). Times have changed, lifestyle have changed and technology is allowing us to do more with mobile (moor's law, smaller, better, faster, more mobile).

I think the future will be more than just our cellphone or smart phones. Devices like the iPad and whatever new mobile devices down the road will play a huge part (as it is doing now). Any PC company that's not hedging their bets on mobile is bound to fail, or get left behind. Let Ballmer continue to fight it.
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More like Gates knew who he was doing ...
BrentRBrian 5th Jun 2010
... he "discovered" and "resold" more "open licensed" software ... P T Barnum would have been proud to know him.
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RE: Chart: Microsoft's performance under Gates vs. Ballmer
Zogg 6th Jun 2010
@NStalnecker Agreed, Gates timed his departure very shrewdly.
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Ever since government starts to mess with MSFT all sorts crazy lawsuits
LBiege 4th Jun 2010
... a successful company begins to suffer.
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Antitrust is a distractor and a killer
BrentRBrian 5th Jun 2010
Antitrust is a killer ... just ask IBM.

The pre-antitrust IBM would have snuffed Microsoft for MS-DOS and OS/2 .. instead IBM had to "take a hosing" from a puny butt company that nobody outside of Tandy, Apple or Compaq had even heard of ...
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RE: Chart: Microsoft's performance under Gates vs. Ballmer
Dealing Updated - 5th Jun 2010
@Zogg Nah, Share price is not about how the companies could actually grow but all about "How people at Wall Street believe that the company could grow." And those guys are pretty dumb.

Many times those people only invest in the individuals over the companies. MS and GE have done well after Gates and Jack Welch was gone but the share never went up.

Let see Apple price after Steve retires or, worse yet, Berkshire Hathaway stocks after Buffett is dead.
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Look closer at the actual chart.
Zogg 6th Jun 2010
@Dealing The curve is *already* flattening off in 1999 *before* the point where Gates leaves. This implies that Gates saw that The Good Times were ending, and so decided to leave on a high note. If your interpretation were correct then the curve's gradient would still be rising in 1999 and would only dip *after* Ballmer takes over in 2000. But it clearly doesn't.
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Wrong Gates was a visionary
rdupuy11 7th Jun 2010
@Zogg

Frankly there are ups and downs, its not statistically important if one year was flat - one flat year never turned Microsoft onto a decade of flat growth before - and you forget there were years of explosive Web 2.0 growth during Ballmer's reign.

Ballmer simply failed to lead - he is not the visionary that Bill Gates is....

What is the criticism here, that Bill Gates was a monopolist and Ballmer is not? LOL, they are both monopolists...but Bill Gates, in addition to that, was actually about finding the next great thing.

Ballmer killed the Courier instead.
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Doesn't anyone teach "best fit" curves to sample data any more?
Zogg 7th Jun 2010
@rdupuy11 Thanks for the "corporate blah", but I'm judging purely on the evidence presented: the curve is flat between 92-93, there is a period of growth which I'm going to call "The Internet" (which wasn't Gates' idea, BTW - he almost missed it completely) and it's flattened out again by 99. And then Gates leaves.

But if you want to tell yourself that Gates was a visionary then I suppose that's your business.
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RE: Chart: Microsoft's performance under Gates vs. Ballmer
notsofast 9th Jul 2010
@Zogg
That pause in the early 90's is called DOS flattening out. 93 is roughly when 3.1 came out, which was a success. That success continued (actually escalated) with Win 9x. It wasn't the internet, because almost nobody had a modem in 93. hell, most people didn't have a computer, which also contributed to the growth.

I think Gates has more vision than Ballmer, but if the handover happened in 93, MS's market cap still would have skyrocketed in the 90's. There was no alternative and PCs were the name of the game.
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RE: Chart: Microsoft's performance under Gates vs. Ballmer
Graham Ellison 9th Jul 2010
@rdupuy11 I think we're all becoming more than a little weary of hearing Gates described as a visionary. Sure, he behaves like a visionary, and the sycophantic hoards of toadies that admire him for his vast wealth treat him as one, but that's the last thing he is.

In about 2005, in a remaindered book store, I picked up a book on Microsoft, a huge volume published in 1998. Remember that date, it's important. In it Gates describes how something called the Microsoft Network was going to join everyone up all over the world. I checked the index and sure enough, the internet wasn't mentioned! Neither was the World Wide Web.

The true visionaries recognised the net and the web as the future, long before this date. What Gates was doing was the oldest con trick in the world, he was attempting to divert attention back on himself as the guru, the 'visionary', the answer to all our needs. Of course all this was simply attempting to maintain an old fashioned monopoly. It's the same trick drug dealers play... and it failed. The internet boom actually completely passed him and Microsoft by - on the other side of the road.

For at least 10 years, Gates had no competitors. But someone did spot the importance of the net. The first iMac, a project Apple had been working on before Steve Jobs returned in 1997, was the first internet ready personal computer - announced in 1998. It was therefore in that year the decline of Microsoft actually began, because their focus had been on maintaining a Microsoft centric vision of the world. And that hasn't changed. Microsoft are still currently lobbying the US Congress to give them a greater hold over the net. There's nothing visionary about that kind of behaviour. It isn't even part of a viable business model.

So, what can we say about Ballmer? Ballmer is a used car salesman [at best] who was in the right place at the right time. And that right place and right time was when Gates bought Q-DOS from Seattle Computer, and then did the deal with IBM. And that was the basis of Microsoft's success - the IBM clone monopoly. That really doesn't even take any clever business skill, never mind some faux visionary qualities.
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RE: Chart: Microsoft's performance under Gates vs. Ballmer
rengek 7th Jun 2010
@Zogg
Hard to tell but maybe not. The graph is not to scale between 20 - 40 and 40 - 60
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Flat is flat, regardless of how it's scaled.
Zogg 8th Jun 2010
@rengek The choice of scale only affects how steeply the curves rises or falls.
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I keep saying it
Cylon Centurion 4th Jun 2010
Ballmer needs to go. Throws chairs all you want at me, but it is the truth.

Anyone else think Gates should come back?
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I'll take Gates, though I'd come across as being selfish
John Zern 4th Jun 2010
as that would take him away from the humanitarian work he is getting done at the moment.
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Such as
Richard Flude 5th Jun 2010
I'm sure they appreciate his money but what is Gates actually doing?
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@Richard Flude
AllKnowingAllSeeing 5th Jun 2010
It looks like he's more hands on then many of these multi-billionaires (Steve Jobs, Eric Schmidt, even Larry Ellison). He does travel to these countries, and he does talk with the world leaders face to face, so he is taking an active roll in what he doing.

The fact that it's less news worthy then who's on "Dancing With The Stars" or what (in)famous actress is the news again for being drunk doesn't mean what he's doing is un-important, just that as a people, we suck for not being as interested as we should.
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@Pliny - A world full of talk
Richard Flude 5th Jun 2010
"He does travel to these countries, and he does talk with the world leaders face to face, so he is taking an active roll in what he doing."

That's my question, what is he doing?
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@Richard Flude
Rama.NET 5th Jun 2010
He travels to these 3rd world countries for the humanitarian causes such as providing medical support for issues such as AIDS, any pandemic or epidemic causes, education, food, health etc.
--Ram--
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RE: Chart: Microsoft's performance under Gates vs. Ballmer
shadfurman 7th Jun 2010
@Richard - Dude, go find out! Its not a secret; take 30 seconds a do a Google search. Or here: http://www.thegatesnotes.com/ Gates personal blog-ish-thing. Yea, a lot of what he is doing is figuring out where to best spend his money, thats probably the best thing he can do. He's smart; smart enough to know he's not as smart as some people.
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Vista screwed up b/c of Gates
LBiege 4th Jun 2010
... insisting implementing everything in managed code I remember. So it's not fair to blame it on Ballmer.
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I'm not sure if . . .
JLHenry 4th Jun 2010
@NStalnecker :

Gates should come back, but when you're in the Tech Industry, you really need a visionary to head the Company, not a bookkeeper.

MS is drifting rudderless, or at least without someone who knows what they're doing at the helm. They cancel stuff like Courier (granted, it might not have made it, but at it was an attempt), then wonder why they can't seem to get any respect as an industry leader. . .
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Nooo... gates should not come back...
x21x 4th Jun 2010
@NStalnecker, its better for gates to spend his time trying to make the world a better place instead of wasting his talent at a company... but ballmer should be replaced... I think someone younger should come in or if they are going to keep ballmer they need to provide resources to their employee's for special projects and let them come to light.

Microsoft seems to just be like one massive research unit that makes things... but never "makes" things. I think they are trying to get past that but they keep going back and forth.
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RE: Chart: Microsoft's performance under Gates vs. Ballmer
Rama.NET 5th Jun 2010
I think DonnieBoy should be made because he knows every single line of Windows and MS office code (he almost claimed that on a different post) and he knows the inside business of Microsoft. wink
--Ram--
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RE: Chart: Microsoft's performance under Gates vs. Ballmer
nDuDut 4th Jun 2010
@NStalnecker :

Put the other Steve on! (Sinofsky)
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Great thoughts guys!
Cylon Centurion 5th Jun 2010
@x21x, I actually think too, that your idea could work too to fix the stagnation.
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RE: Chart: Microsoft's performance under Gates vs. Ballmer
AirborneDude 7th Jun 2010
@NStalnecker Gates shouldn't come back. Since Gates left, M$ has become more accepting to open source. Plus, during Gates reign, M$ released crap stuff. Windows 3.1, 95, 98, and NT were the worse OS's(Win98 SE was ok). In those days Microsoft was better at marketing than making a good OS. It wasn't until Win2k and XP came out they started making stable OS's. It is amazing people put trust in M$ products to run their business back then.
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RE: Chart: Microsoft's performance under Gates vs. Ballmer
shadfurman 7th Jun 2010
@NStalnecker Gates is doing better things now than running Microsoft. I don't want Microsoft to go under, I rather like Microsoft products, but if Gates was the soul behind Microsoft then I'm glad that soul (and wealth) is focused on philanthropy work. I love capitalism but philanthropy needs a break from idealistic bleeding hearts and some fresh sustainable capitalistic methods. Gates will do more for the world where he is, the world will survive just fine without Windows. If Windows dies, another OS will take it's place. Heres an possible future: Microsoft whithers as market cap drops, someone buys them and integrates optional Windows compatibility into their OS making the transition to a new OS seamless. I doubt it would happen this way, but it wouldn't be a bad thing.
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Yes the emperor has no clothes
Richard Flude 4th Jun 2010
"Honestly, it?s surprising that Steve Ballmer hasn?t come under more fire during the past decade for Microsoft?s lack of innovation, dearth of new hit products, and a stock price that has continued to tread water."

Sure is surprising, not that some of us were fooled.
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2 different times?
John Zern 4th Jun 2010
10 years is 10 years.
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A far simpler explanation...
zkiwi 4th Jun 2010
Is that around 2k the Windows/PC market pretty much reached maturity for the first time. Mature markets do not equal massive growth rates, but rather rather a plateau point.
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Take a look at the graph, with out depreciation
Uralbas Updated - 4th Jun 2010
MSFT has lost half the value that peaked with Gates. Now if you consider this in constant dollars, its definitely under half the value it once had.

Balmer needs better consultants or he should leave. He always hits behind the times. And he doesn't get it.

There are people good at managing money (Murdoch, Rockefeller), there are people good at tech (Einstein, Boyd, Hayt, Lightfoot).

Few are like Gates, Jobs, Ellison, Hughes, Ford. With both foresight about technology in their fields and economics.

I wonder where Balmer fits, cause he is not one of the latter.
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RE: Chart: Microsoft's performance under Gates vs. Ballmer
wafsd 4th Jun 2010
Microsoft performance during Ballmer's tenure pretty much tracks that of the greater economy, with the bookends of the Dotcom crash and the implosion of Wall Street. Companies and households alike have been in a holding pattern in terms of spending. Luxury goods have been selling, but basic consumer or corporate goods have not. My electronics, home and work, are being used until they wear out, for example.

Should the company have done better in terms of newer products? Probably. Then again, I'm now using more MS products than ever before because the older software is solid and the newer software provide real reasons to upgrade. Doesn't add a whole bunch to Microsoft's profit margins at present, but it also adds nothing to anyone else's, either.

Finally, given the strength of the software coming out of Redmond and what I can see following it, MS is poised for growth - assuming we do not fall into a double-dip recession. For example, I haven't carried a personal cell phone in three years, just the company Blackberry. I'm waiting for the 7 phones to come out and then I'll get one. I've had my hands on iPads and think they are kinda cool, but I want something that will fully integrate with my existing computing investments, so will wait to see whether I can get an MS-stack tablet that does what I need it to do, such as play perfectly with SharePoint.

In the end, the "lost decade" has more to do with macroeconomic forces than with the actions of Steve Ballmer. The coming decade, however, that's a different kettle of fish. MS needs to get mobile/handheld devices *right*.

And, Steve, reconsider killing the Courier. That is the single device I have read about in the last ten years that made me say (and continue to say) I. NEED. That. NOW!
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RE: Chart: Microsoft's performance under Gates vs. Ballmer
dave95. Updated - 6th Jun 2010
@wafsd

Sounds like you're putting much of the blame on the Economy and not Ballmer/Microsoft. Take a look at Apple during the same period, not much blaming the economy there. They started opening their Apple Stores back in 2001. Everyone thought they were nuts especially when others like Gateway was struggling or closing. At the time DELL and others were racing to the bottom tarnishing their brand with cheapware, Apple instead offered customers quality (even during the down time with cheap built netbooks everywhere). They've sold hundred of millions of iPods since. They've released an premium quality phone, with no regard for the economy. With the belief if you build it they will come. They've kick-started an App Store gold rush for the iPhone (another thriving business model created from scratch). And now look they are doing the same with the iPad. There is a quote from years ago where Jobs said "we will continue to innovate during the down time", and we see the results of that today. Absolutely no blaming the economy.

Microsoft killing the Courier just shows a company not willing to do the same, innovate. They created excitement over some rendering and is basically saying, sorry we just cant pull it off right now, or ever.
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Two amazing things about this piece
haimtoeg@... 4th Jun 2010
The first is the difference in performance and the lack of any share holder pressure to replace Ballmer. The second is that someone who writes about shares on such a respectable platform can't recognize a logarithmic chart when he sees one (or worse, assumes his readers are clueless)
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I was going to say...
rapson 5th Jun 2010
@haimtoeg@... it IS to scale, just a logarithmic one. One must avoid the error in trying to interpret a logarithmic scale the same way one interprets a linear scale.
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Balmer should stay!
kikl 5th Jun 2010
I'm quite happy about microsoft's lack of growth and performance. This gives competitors the chance to crack the MS windows/office monopoly. More competition and open standards are going to boost innovation and lower tech prices. With balmer heading microsoft the future of software and hardwar looks rosy.

Regards

Kikl
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RE: Chart: Microsoft's performance under Gates vs. Ballmer
gtdworak 5th Jun 2010
@kikl: I couldn't agree more. Ballmer is the best thing that ever happened to Apple. It almost seems he is sabotaging his own company with one stupid decision or action after another. Why he hasn't been ousted, i'll never understand. Steve Jobs got ousted from Apple back in 1985 for a lot less. The Microsoft board of directors is asleep at the helm, Ballmer is a bafoon and should have been aced a long time ago.
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RE: Chart: Microsoft's performance under Gates vs. Ballmer
tburzio 5th Jun 2010
You can't blame Ballmer all that much. About the time the graph levels out, companies were getting wary about Microsoft and their predatory technology practice of borrowing tech innovations without paying for it, for this is how Microsoft innovates. This coincided with the first insider biographies of Gates and how he rampaged through Universities and Apple, picking up unpatented ideas to found Microsoft in the first place. Without this constant stream of gullible companies willing to give up their tech, there was nowhere for Ballmer to go!
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RE: Chart: Microsoft's performance under Gates vs. Ballmer
dheady@... 5th Jun 2010
While I'll be the first to stand in line to bash M$, consider that Billy left MS as it hit a market saturation level with its OS and was struggling then, as it is today, with enterprise and other markets. A company the size of Microsoft is much like General Motors in that innovation is an anathema to the corporate culture. Too many minor improvements have to pass through too many committees. Granted Mr. Balmer isn't exactly the pied piper of innovation and technology,but the fact that MS has maintained its market share in its money makers, OS and Office, in spite of major assaults from *nix, including Mac OS X is to his credit I think. If nothing else, 'treading water' in the tech industry is an accomplishment. Whee sees the likes of past colossi like Palm, who owned the PDA market, dry up and get blown away like so much silicon dust, maintaining your position in this industry is a major accomplishment.
There is to keep in mind that Mr. Gates seldom actually innovated technology. Aside from cutting code for Basic on the Altair, Gate's record of either shysting or stealing technology has been historical. His real ability was in misleading his partners ("IBM compatible" and access to the Mac code) and parlaying that into a monopoly (see "IBM compatible"). The growth you see on that chart represents Microsoft's ascendancy to a monopoly and the abuse of that monopoly (lost every monopoly suit filed against it). There simply wasn't enough low hanging fruit left for Mr. Balmer to pick when Billy decided to cash in and become a philanthropist (credit due where credit is due).
Comparing Mr. Balmer with Mr. Jobs is very unfair based in part on my previous comments. Mr. Balmer, as stated, presides over a behemoth of a GM clone, culturally. Changing that would most likely be beyond even the prodigious skills of Mr. Jobs. Keep in mind, when Steve came back to Apple it was a pale ghost of its past glory. He came into a company that was well on its way to oblivion, mainly because it had adopted that very GM culture, even in the face of its own extinction through lack luster innovation, sales, et al. In short, Steve was able to resurrect Apple by cleaning house and creating a culture of innovation rather than a GM clone. Apparently he's even done that to the extent that, at least for a time, Apple would be able to continue that path without his 'distortion reality field' influence. While Jobs isn't the total ass he might have been when ousted from Apple by Scully, he still apparently has the fire in the belly that demands excellence and vision. In other words, the universe continues being dented by Steven Jobs.
Balmer, not so much.
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Well...
Dave32265 5th Jun 2010
As I have said before, Ballmer needs to go. Having someone with NO tech background running one of the biggest tech corps in the world is insane at best. But hey, if their shareholders are satisfied with 25-30 stock prices, so be it. Look at Apple (another company I have no great love for, btw) and its 200 per share and surpassed MS as the largest. They must be doing something right.

Getting fresh young blood in management, development, and especially the marketing depts would help MS greatly at this point. No one wants to see a CEO hop around on the stage like a monkey or acting like a retard. It's undignified.
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Different idea
Daniel Breslauer 5th Jun 2010
I think 99/00 was around the time when most households had a PC. Just a guess. Like with cell phones: once the market reaches a certain level of saturation, sales level off and profits become less.
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The chart is very dubious
georgeou 5th Jun 2010
http://www.digitalsociety.org/2010/06/lets-try-to-be-fair-to-ballmer/
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RE: Chart: Microsoft's performance under Gates vs. Ballmer
storm14k 5th Jun 2010
It isn't Ballmer's fault. The meal ticket just ended. There was nothing that great or innovative coming out of MS. They simply were the only thing you were going to get on a PC and as the PC market continued to rise so did MS's value. Now PC's aren't the hot thing anymore. Its common to have one and the hardware is dirt cheap. It just doesn't seem "amazing". In fact from 2000 till the iPhone I'd dare say the entire consumer tech market was stagnant. The iPhone came along and sparked mobile computing. It wasn't anything all that innovative or drastically different. But it made the space hot and any company doing work in that field will skyrocket in value. When that market is no longer the new hotness the same thing will happen.

All this crap about growth is truly crap. Its somebody's made idea of how valuable a company should be. Apple is now "bigger" than Microsoft....with 8% of the market and no real moves made in the greater technology landscape. I dislike MS but at least you can see their place in the server world, databases, PaaS, software development, etc. Where is Apple in any of that? They aren't shaping any sort of technology trends outside of gadgets. They slap a pretty interface on an OS that has been here for years and they are "innovative". They are simply a gadget company whose time will end when gadgets aren't as hot anymore.
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In denial and much.. and what envy!
MacCanuck Updated - 7th Jun 2010
>>> The iPhone came along and sparked mobile computing. It wasn't anything all that innovative or drastically different. >>>

Wow... what bull and an asinine statement of denial.

The iPhone changed the smartphone landscape and got phone makers off their butts, thus all the iPhone wannabes and clones since January 2007.

Android owns it's look, feel and existence to the iPhone, thanks to the Google spy Schmidt (while on Apple's Board) sitting in on months/years of Apple iPhone talk and demos. If you have any doubts or try to argue with the iPhones influence on Android (and other mobile OS's), just look at the state of various Linux distros and how lousy the UIs are, except when lifting the best "features" from others. Generally techno geeks (coders) are not good at usability and interface design.

>>> Where is Apple in any of that? >>>

Leading while others copy and follow... iPhone and now iPad the latest examples. (note how many planned tablets have gone back to the drawing board and now delayed until late this year or into the next due to the iPad).

Reality (and honesty)... you should try it sometime.
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Different strokes
Golodh2 5th Jun 2010
Interestingly, the dip in MS value in 2005 seems to coincide with the episode of Mr. Ballmer throwing his famous chair. Sorry, couldn't resist that.

As others already noted, the first half of Mr. Gates' reign was in a period in which the market was growing and developing. Microsoft got its first wave of growth from MS-DOS, and only because Gates had the aggressiveness and vision to hold out for ownership, and corporate IBM didn't see why or how that would be crucial. hen came the MS Windows era, which trundled along taking advantage of improved processor power, the shift from 8-bits to 16 bits, and then from 16 bits to 32 bits. The main thing was to keep MS Windows at the fore, and to kill off competitors in the areas of spreadsheets (Lotus, Quattro) text processors (Wordperfect), and compilers (Borland Pascal, Borland C). All of which was duly presided over by Mr. Gates, who nonetheless almost failed to spot this Internet thing.

Nowadays we have the wave of telephones and handhelds. I believe that Mr. Gates would *not* have allowed e.g. Linux and Symbian to gain such foothold, and would have thrown whatever resources it took at the market to make Windows CE the dominant player. In addition he would not have let Google get away with achieving dominance. He would have clawed market-share away before they were dominant. Of course Microsoft was then under scrutiny from the courts and couldn't really pursue the same tactics it had against Netscape, Borland, Lotus etc. But still ... it could have made sure that it fielded a product that was better than the rest. Only it didn't.

This does highlight something of the difference between Mr. Ballmer and Mr. Gates. Mr. Gates isn't a whit less agressive than Mr. Ballmer, if anything he is more agressive because he will not allow any other company to become dominant in a market he perceives as being of strategic importance to Microsoft, but he always managed to find the levers that Mr. Ballmer so far hasn't.

Remember when Microsoft was missing out on that new thingy called the Internet? The entire corporate hierarchy of marketing people, strategists, managers, directors and whatnot had *missed* that.

Instead it was Mr. Gates *in person* who separated the signal from the noise and turned Microsoft on a dime to pursue "the internet", whatever the hick that was. That was why Microsoft poured so much money into Internet Explorer so quickly, and why it deliberately and purposefully "cut off the oxygen" for Netscape by giving MS IE away for free with the operating system. How's that for aggressive, eh? More importantly, it was aggression focused in the important spot.

As others noted, Mr. Ballmer is an excellent corporate executive, smart, aggressive, listens well to people. But he doesn't have a clear enough personal understanding of where the action will probably be in 5-10 year and how to corner and cash in on that market. He doesn't know how to spot the moment when only the "**** or bust" policy works. He hasn't got, and forgive me for using that awful cliche word, the vision. He's brilliant at keeping the company on the same course as it was yesterday, and discerning any obvious road signs. Only ... by the time those signs are so clear that even a corporate machine will pick them up, the competition will have picked them up too.

Of course, Microsoft's position is so strong that it will take a lot of doing to topple it, but unless it continues to dominate the market that's what will happen. The problem is that nobody seems to have a clear idea of what that market will look like in 10 years time.
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RE: Chart: Microsoft's performance under Gates vs. Ballmer
Dr. Figgnuttan 5th Jun 2010
Noun: Microsoft |mike row soft|
1. Inactive
=0
~ inactive
Adjective: defunct |de funked|
1. No longer in use
*a defunct organization*
~ dead
Late twentieth century computer operating system.
Largely abandoned by early 21st century nomotechologicus!

Dr. Figgnuttan Retire the symbol MSFT rip
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Steve's doing Grrreat!
symbolset 15th Nov
I want him to stay right where he's at, doing what he's doing.

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