Microsoft's Ballmer gets docked for Windows 8, Surface RT

Microsoft's Ballmer gets docked for Windows 8, Surface RT

Summary: Microsoft CEO Steve Ballmer recieved 76 percent of the total incentive award for which he was eligible in fiscal 2013. Issues plaguing the Windows division were to blame.


Microsoft's annual proxy statement indicated that Microsoft CEO Steve Ballmer had his pay docked because of Windows division's lackluster performance in the past year.

Ballmer received $1.26 million in fiscal 2013 — a base salary of $697,500 and a bonus of $550,000. Ballmer's "incentive plan award," calculated by the Microsoft board, was only 79 percent of the total for which he was eligible.

Comparatively, for fiscal 2012, Ballmer received 91 percent of his eligible incentive award.

The fiscal 2013 proxy statement spelled out the reasons why Ballmer was docked:

"The company faced challenges due to weakness in the consumer PC market. While the launch of Windows 8 in October 2012 resulted in over 100 million licenses sold, the challenging PC market coupled with the significant product launch costs for Windows 8 and Surface resulted in an 18% decline in Windows Division operating income. Slower than anticipated sales of Surface RT devices and the decision to reduce prices to accelerate sales resulted in a $900 million inventory charge."

The latest proxy indicated that a number of other Microsoft managers received 100 percent of their incentive payments , including Chief Operating Officer Kevin Turner; Chief Financial Officer Amy Hood; Office president Kurt Delbene. Server and Tools chief Satya Nadella actually received 105 percent of his eligible award. Server & Tools was a consistently high-performing division for Microsoft during the past fiscal year, with the unit housing seven $1 billion-plus businesses.

In fiscal 2012, the three percent decline in revenues for Windows and Windows Live; slower than planned progress in Online services; and the Windows division's failure to provide a browser choice screen on certain Windows PCs in Europe led to Ballmer failing to receive his full 100 percent last year.

Former Windows President Steven Sinofsky also didn't get his full incentive award payment last year as a result of the European browser-ballot issue.

Topics: Windows 8, Microsoft, Tablets, PCs, Microsoft Surface


Mary Jo has covered the tech industry for 30 years for a variety of publications and Web sites, and is a frequent guest on radio, TV and podcasts, speaking about all things Microsoft-related. She is the author of Microsoft 2.0: How Microsoft plans to stay relevant in the post-Gates era (John Wiley & Sons, 2008).

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  • Microsoft's Ballmer gets docked for Windows 8, Surface RT

    I'm sure Steve Ballmer isn't too worried since he is stilling walking out with over $1 million and retiring soon. Even with all the challenges Microsoft has faced they sold over 100 million licenses of Microsoft Windows 8 and capturing 8% of the market share.
    • I'm sure the 18 billion he already has

      will help him through the tough times of having to live on his reduced salary.
      • Nonetheless, it is a huge slap on the wrist

        and it is hardly the way he would want to be leaving MS.
        • Re: it is hardly the way he would want to be leaving MS.

          That might explain the tears... he is not a crocodile, after all :)
          • [Insert Babelfish]

            More inanity brought to you courtesy of danbi...

            wth are you on about now?
  • Of little comfort to Microsoft's stockholders

    He should have been terminated, outright, for relentlessly steering the ship into the ocean. Now it will be like Atari - once mighty, later bought and sold by numerous owners.
    D.J. 43
    • MS just sits there

      Yes. MS is in imminent danger, because one of its 16 billion dollar businesses is having difficulty. By your reasoning, Apple is about to go out of business too, because its iPod business is collapsing, and its Mac business is experiencing difficulty as well.

      I blame MS for this. Because it just sits there and allows its enemies to smear its image over and over and again. I wouldn't be surprised if its enemies are behind the whole shareholder raucous.
      P. Douglas
      • " allows its enemies to smear its image over and over and again."

        But, of course, MS has never launched a disingenuous advertising campaign against one of its competitors, has it!
        • But Apple has

          and is praised for it.
          John Zern
        • What? Like the Mac/Apple guy commercials!?!?!?

          Perhaps one of the worst pack of lies ever told on television. It got by because at first people thought it was funny. It wasn't until a few of them had been done when people started saying, "alright, enough, we get it, Apple dosnt like Microsoft, but...we are not idiots. We like Windows better...these ads are just downright insulting"

          So I don't know about MS ever launching a disingenuous ad against a competitor, but Apple has definitely made some of the most personally insulting commercials ever made.
      • no, actually

        I just think Ballmer is a moron.
        D.J. 43
        • And yiu are wrong

          But that is a recurring theme with you.
          Michael Alan Goff
      • "Sir, we just hit an iceberg."

        "I don't see any problems. Besides, we're making great speed and it's a beautiful night.
        High Tech Troglodyte
    • You keep thinking that

      and when they don't, will you have an excuse ready?
      • Yes

        The excuse for his successor will be steering a massive ship into a complete 180 after it was off course, may take too long anyway. Thanks for playing.
        D.J. 43
        • Doing a complete 180 would mean causing MS to

          fail completely.

          Microsoft is still a very profitable company, even as their Windows division is showing lackluster growth.

          MS is still better positioned than Apple and Google to survive a downturn in the economy, because it is the only one of the three companies that has such a diverse set of products and services with most of them showing great bottom lines.

          So, a 180, as you believe, would send the MS ship into the bottom of the ocean.
    • "Relentlessly steering the ship into the ocean"

      Might want to work on your analogies there, bub. Generally speaking, I think the ocean _IS_ where you want to be steering a ship.

      Otherwise, an extremely pithy and insightful comment /sarc
    • You will be bought and sold!!!

      What a dufus D.J.43!

      What is this, some kind of drunk tank? Your prediction is ridiculous and completely meaningless.

      How about this one..."Microsoft will rise up and become the mightiest of companies of all time, taking over the entire world by storm and soon being called upon to use their incredible talent and brilliance to first advise and direct many governments of the world, in the end only to be asked to take over the United Nations as a whole and govern the entire world according to their own boundless wisdom, soon all people of all the world will abandon their former allegiances to anything and everything that was not Microsoft and as such Microsoft will usher in an endless time for mankind to live in perfected peace and tranquility forever more..."

      There! Hows that for an entertaining bit of nonsense! Is that what your trying to do?? Entertain us?

      You probably know as well as anyone there is no chance of any kind of Microsoft becoming Atari the second at any time in the near future.

      Next time you want to say something as silly as that, make it real ludicrous so everyone will know your just kidding as opposed to just thinking you like sounding like a goof.
  • MS is profitable

    is sitting on a boatload of cash, has numerous revenue streams, and dominates in numerous market segments. Despite that, Ballmer leaves his successor numerous problems. Apple , Android, Amazon, Google, Facebook, and Netflix either didn't exist or were minor players at the time Ballmer took the reins at MS. They all represent lost opportunities for MS. They all represent failures by MS to recognize and/or respond effectively to a changing computing landscape. MS sunk billions into search, social media, and mobile computing/smartphones only to be outplayed by start ups, upstarts, and a reinvigorated Apple that most people had given up for dead.
    • Re: either didn't exist or were minor players

      Apple has never been minor player in personal computers.

      Whoever things this, either does not know anything about this industry, or is just a hopeless fanboy.

      Apple for one, won at least two wars with IBM... Microsoft are yet to face IBM and that company is well known to be not happy with their past encounters. The same could be said for Intel, who can blame their recent problems with the promises Microsoft made and did not fulfill. If Intel gets mad with Microsoft, things might go bad for the "tech giant", fast. All of their Windows PC OEMs are mad at them for one reason or another. Over the years, Microsoft has made no friends, only enemies.