UPDATE: Gates steps down as Microsoft CEO

Gates resigned overnight as CEO to take a new role as chief software architect at Microsoft. He will continue as chairman of the company and sidekick Steve Ballmer will take over as CEO.

As reports claiming the US Department of Justice is leaning toward the break-up of the company increase, Gates may be positioning himself for a role as Chairman with any and all of the restructured companies, Penn said.

With no official day-to-day role with any of Microsoft's divisions, Gates would indeed be able to take up the position of chairman at all of the companies - unless the DoJ restricts him from doing this as part of the settlement, Penn said.

However, Penn said Gates' resignation was also "simply the acceleration of what Microsoft had already been planning" after the promotion of Steve Ballmer to President of the company in July 1998.

In a leaked email obtained by Computerworld from Bill Gates to Microsoft staff in the US, Gates said he and Ballmer, planned to reinvent the company so as to "empower people through great software".

In reply, Ballmer said Gates would continue to serve as Chairman of Microsoft, and devote "100 per cent of his time and energy" on the company's Next Generation Windows Services (NGWS).

Meanwhile, Australian Microsoft managing director, Paul Houghton was not surprised by the news, and said it would not affect local operations other than on a worldwide basis.

"It's a great opportunity for Bill to get close to the technology and for Steve to step up and have the leadership role in the company," he said.

"Bill has been talking to the board for a little over two years in terms of getting closer to the technology, so he's had the desire to move in that direction and it was just a matter of the right time to be about to do that."

Houghton dismissed suggestions the change was in preparation of the speculated split of Microsoft by the DoJ, but did admit the company was going through changes.

"We're in a major [state of flux] with the company right now and in terms of the direction that we need to go to drive the company over the next ten years. . . We don't think that there's any value to consumers or business in splitting up the company," he said.

"None of these moves are in preparation or in thought of that as a potential outcome of the Department of Justice law suit."

Houghton said under Ballmer, customers can expect a "very rapid response to the way the market is driving the software industry and the opportunities we see for software over the next 10 years."

* For the full story, see Computerworld 24/1/00

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