Last Updated: 8/1/2007 12:09:13 PM
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Gates plans his leave amid great change

Microsoft is beset with competition from all sides, unlike any it has seen in decades, and Bill Gates, who co-founded the company 32 years ago, still intends to step away next year as planned.

But so far, Gates, Microsoft's 51-year-old chairman, shows no sign of fading away.

One year into a planned two-year transition, there are few visible cues that Gates is ready to leave the world's technology stage to devote his energies principally to the $33 billion foundation he established seven years ago with his wife.

Indeed at the company's annual financial meeting last week Gates spoke first, outlining a decade-long agenda, not a mere 12-month outlook.

He described a world in which the widespread availability of broadband networks would reshape computing, giving rise to what he said would be "natural user interfaces" like pen, voice and touch, replacing many functions of keyboards and mice.

Gates has stayed deeply engaged in the company's technology strategy. He still frequently participates in high-level strategy planning sessions with Microsoft's closest partners, like Intel, according to executives who have attended the meetings.

During a wide-ranging interview last week exploring his diminished role at Microsoft, the company's challenge and its competitors, Gates insisted that he really has begun stepping back.

"I am in a lucky situation of having way more things that seem interesting to do and very exciting and important, and working with smart people, and highly impactful, way more than a 24-hour day will fit," Gates said. To be sure, there is widespread skepticism in the industry about the possibility of Gates genuinely disengaging. Microsoft's dominance is being challenged as never before by Google in particular, and Wall Street refuses to believe the company will regain its edge. The company's stock has largely remained flat since the end of the dot-com era.

"It's very hard for someone at his age, who has built a company with that much success and with continuing challenges, to really walk away," said David B. Yoffie, a professor at Harvard Business School. "He will never be a titular leader."

As he spoke in his office, Gates was joined by the two Microsoft executives, both veteran technologists, who are succeeding him. Craig Mundie, the chief research and strategy officer, and Ray Ozzie, chief software architect, agreed with Gates that despite significant industry challenges from all directions, Microsoft is at a perfect historic juncture for Gates' departure and the first stage of his withdrawal from Microsoft has been reasonably seamless.

"The weaning process inside the company is inevitable," said Mundie, a computer scientist who began his career developing minicomputers and supercomputers before joining Microsoft in 1992.

The greatest danger, according to all three executives, would be if Gates continues to make decisions while not staying deeply involved. He will remain chairman.

"It can't be a situation where he's expected to suddenly, magically come up to speed," said Ozzie, a software designer who developed a software collaboration tool called Notes for Lotus and then started Groove Networks, which was acquired by Microsoft in 2005. "You know, did you see the 20 announcements last week that Google did, Yahoo did, Cisco did?"

For his part, Gates said he planned to remain deeply involved in a few areas indefinitely.

"Other than board meetings, there's not much in terms of regular meetings," he said. "It's much more sitting down a couple hours a month with Craig, sitting down a couple of hours a month with Ray."
Source: CNET

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