Just days after announcing a delay in when Windows Vista will ship, Microsoft has significantly restructured its Platforms & Services Division and appointed Steve Sinofsky, who has headed the Office team until now, to lead the Windows and Windows Live groups, giving him broad responsibility for planning future versions of Windows.
The software maker said the changes are aimed, in part, to help Microsoft improve its online strategy.
The company said a reorganized Platforms and Services division will be made up of eight new and existing groups, including the Windows and Windows Live Group, led by Steven Sinofsky, a high-ranking executive currently in charge of developing many of the company’s Office business products.
The restructuring — part of a plan by the vendor to repair what it sees as lack of agility and growth in the division that oversees its largest property, Windows — also breaks up and renames groups that were formerly a part of the MSN division.
While the Redmond, Wash., company is saying the reorganization is designed to better align the existing Windows and MSN assets with Microsoft’s overall Live strategy, some sources tell eWEEK that the delay in the release of Windows Vista was the catalyst for the move, more so than Microsoft’s stated goal of "ensuring the company delivers a full range of software-based services to consumers and businesses around the world."
Companies such as Google and Yahoo are fast developing internet-based products that pose a threat to Microsoft’s desktop-bound Windows and other programs.
Microsoft has responded with a beefed-up online effort of its own, dubbed ‘Windows Live’, that is meant to complement its dominant Windows system.
Sinofsky is credited with running a tight ship and sticking to internal and shipping deadlines, a characteristic Microsoft is no doubt hoping he will bring to the Windows development teams going forward. He will also focus on planning future versions of Windows, while longtime Windows executive Jim Allchin will work closely with another Microsoft executive, Brian Valentine, to finish the long-delayed Windows Vista.
Another new group will focus on aspects of the Windows Live strategy, including the potentially lucrative online advertising market. Other groups will work on the core operating system and the servers and software tools businesses.
Kevin Johnson, co-president of the Platforms & Services Division along with Jim Allchin, announced the changes in an e-mail to his division, and intimated as much, saying that one of the goals driving the change was to "increase Microsoft’s agility in delivering innovation to customers." The group overseen by former Office group leader Sinofsky — the Windows and Windows Live Group — is one of eight groups that now comprise the division, according to Microsoft.
"As we launch new Windows Live services and finalize Windows Vista, we are looking ahead to how we deliver the best possible experience for customers, now and into the future. Today we are enhancing the leadership team and structure across the division to ensure we have the right organization to support our technology vision," Johnson said in a statement.
The restructured PSD organization will continue to be led by Allchin and Johnson until Allchin retires next year as planned, at which time Johnson will become sole president of the division.
Allchin will also work closely with Valentine to deliver Windows Vista, Microsoft said, adding that Valentine’s mission remained focused on shipping Vista. Sinofsky will assume responsibility for the process and planning of future versions of Windows, the company said.
The new PSD is made up of eight new and existing groups: The Windows and Windows Live Group, led by Steven Sinofsky, senior vice president; the Windows Live Platform Group, led by Blake Irving, corporate vice president; the Online Business Group, led by David Cole, senior vice president; the Market Expansion Group, led by Will Poole, senior vice president; the COSD (Core Operating System Division), led by Brian Valentine, senior vice president; the Windows Client Marketing Group, led by Mike Sievert, corporate vice president; the Developer and Platform Evangelism Group, led by Sanjay Parthasarathy, corporate vice president; and the Server and Tools Business Group, led by Bob Muglia, senior vice president.
The Windows and Windows Live Group is new, and includes the Windows engineering team as well as development for the Windows Live online services Microsoft launched in November. Also new are both the Windows Live Platform Group and the Market Expansion Group, while Cole’s Online Business Group replaces the division that once was MSN, according to Microsoft.
Online Business Group leader Cole was formerly a top MSN executive alongside Yusuf Mehdi, who also has reshuffled into a different role. Mehdi now serves as senior vice president and chief advertising strategist as part of the new management team of Platforms & Services. Cole plans to take a leave of absence from Microsoft in April and a new leader for the Online Business Group will be announced at that time, Microsoft said.
The Online Business Group includes advertising sales, business development and marketing for Live Platforms, Windows Live and all of the MSN properties, including MSN.com, MSNTV and MSN Internet Access. Microsoft’s MSN division has suffered from lack of growth and an identity crisis, especially after Microsoft announced its set of Web-based services under the Live brand in November.
Some MSN teams that had been working on services and capabilities for Microsoft’s online offerings also fall under the Windows Live Platform Group. The Market Expansion Group will focus on emerging markets and new form factors, including the Origami ultra-mobile PC Microsoft and hardware partners recently unveiled.
In addition to these changes, Mike Nash will be moving from his job as lead for the Security Technology Unit to a new role that is not being announced at this time. Ben Fathi will succeed Nash in leading security efforts.
The changes follow a directive issued by Microsoft Chairman Bill Gates several months ago aimed at rallying his troops toward offering more ways to do things like store e-mail and manage business tasks over the internet.
A Microsoft spokesperson declined to say who would replace Sinofsky and head the development of the Office suite of products. Sinofsky will "stay involved in transition mode through May. Jeff Raikes, the president of Microsoft’s business division, will be working with Sinofsky and his team to develop the best leadership structure for the future of Office," she told eWEEK.
Sinofsky will work closely with chief technology officer Ray Ozzie and Blake Irving to support Microsoft’s services strategy across the division and company.
Yusuf Mehdi, senior vice president, is taking on a new role as chief advertising strategist, where he will have a key part in shaping Microsoft’s strategy for targeting the growing online advertising market, and will report directly to Johnson.
Martin Taylor, appointed a corporate vice president, will transition from the Server and Tools business to lead Windows Live and MSN Marketing. Taylor will run product management and marketing for Windows Live services, MSN.com and the company’s Live Platforms, focusing on developing the brand and bringing new service innovations to customers, Microsoft said. Taylor was responsible for leading Microsoft’s controversial "Get the Facts" anti-Linux research campaign.
Will Poole, who previously ran the Windows Client business, will be moving to lead the newly created Market Expansion Group within the Platforms and Services Division, focused on emerging markets and new form factors.
"Establishing an organization with product marketing and research and development responsibilities will bring focus to this key growth area for Microsoft and its potential customers around the world through products such as Windows XP Starter Edition and the recently launched Ultra-Mobile PC devices," the company said.
All of the other groups and their leaders remain the same, except Sievert now reports directly to Johnson, Microsoft said.
In his e-mail, Johnson said he and group Co-President Jim Allchin worked out the changes together to prepare for Allchin’s impending retirement at the end of the year. In addition to spurring growth and agility in the division, the changes also were made to advance Microsoft’s Web-based services strategy, he said.
Those changes grouped the company’s seven business units into three divisions.
Microsoft also announced a restructuring in September, aimed at reducing bureaucracy that, some say, has hindered the company’s ability to nimbly compete with companies such as Google.
The Wall Street Journal reported that Microsoft planned to make sweeping changes in its Platforms & Services Division in the wake of another delay to the release of the next version of Windows, Windows Vista. Microsoft said it would not meet its deadline to release the client version of Vista on hardware by the end of the year. Instead, the business versions of the OS would be available to volume licensing customers by then, but the OS would not be on PCs until January 2007.
Microsoft has been under pressure to grow its revenue as its seen growth in its core businesses — Windows and Office — level off in recent years.