As the Microsoft CEO rumors churn: The Gates factor

Bill Gates to take on more of an active role at Microsoft under the next CEO: Reality or image? I vote the latter.
Written by Mary Jo Foley, Senior Contributing Editor

As Microsoft allegedly edges closer to naming its new CEO, rumors about a new, more involved role for company founder Bill Gates are gaining steam, too.


According to three different reports from the past few days (Re/code, Bloomberg, Wall Street Journal), Microsoft board chairman Gates may end up resigning as chair to take on a more active product-development role at the company.

As I've blogged before, I do not have any first-hand board-level leaks about the CEO appointment process. I don't know if Microsoft's current Cloud and Enterprise chief Satya Nadella really will end up taking on the CEO job. And I don't know what kind of talks are happening behind the scenes, if any, involving Gates.

What I can comment on, however, is positioning vs. reality. And when it comes to industry legend Gates, positioning is a tricky subject.

When Gates resigned from his day-to-day duties at Microsoft six years ago, Microsoft officials went out of their way to insist that even though Gates was going to be working full time at his foundation, he'd still be very involved in decision-making at Microsoft.

The reality? From all accounts I've heard, he wasn't. I am sure he might have opined on products, strategies and reorgs, but Gates had a lot of other non-Microsoft things on his plate. His focus has been on malaria and public health far more than on Bing and Outlook.com, I'd wager.

But instead of treating Gates' distance as a liability, Microsoft image makers played it up as a strength. The public message became: It's OK that Bill's not as involved. Even though he did many amazing things while CEO and Chief Software Architect, he also made some blunders, like refusing to settle massive, expensive lawsuits and allowing too many crazy projects (and technologists) to run amok. It took a business guy, CEO No. 2 Steve Ballmer, years to undo some of these missteps, so the story went.

Now, if the rumors about Gates' reinvolvement in day-to-day work at the company are correct, Microsoft officials are going to have some fancy footwork to do.

Though it might make more strategic sense to have Ballmer, who has been running the company for the past 20 years, be the one helping the next CEO come up to speed, Microsoft execs need to distance themselves from Ballmer if they are to portray the company as changing.

Even though Ballmer arguably knows Microsoft's current products and plans better than Gates, Gates may need to play the role of the "white knight" whom officials hope will make someone who has never been CEO of a major company (Nadella) look less "green." Nadella recently told me he has been receiving some helpful guidance from Ballmer about running teams and honing product strategies. But now that Ballmer is being edged out, being his buddy may be more of a PR liability than asset.

Gates recently insisted that he plans to continue to make running his foundation his life work. He has said this before -- repeatedly, even. Gates is selling off more and more of his Microsoft stock, and soon is likely to be eclipsed by Ballmer as the largest individual Microsoft shareholder. It's a gamble to position someone who has been largely out of the day-to-day tech loop for the past six-plus years as a selling point... even if that someone is THE Bill Gates.

What's your take? Would making Gates the next Microsoft CEO's right-hand man help Microsoft more than hurt the company at this point?

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