Gates Starts Slow Transition From Full-Time Microsoft Duties

Microsoft Chairman Bill Gates Thursday said he plans to stop working full time at Microsoft in July 2008 in order to spend more time on his global health and education work at the Bill and Melinda Gates Foundation.

Gates will continue to serve as chairman and an adviser on key development projects even after he stops working full time. Effective immediately, however, he is giving up his chief software architect title to Chief Technical Officer Ray Ozzie. Company watchers had been expecting that move since Microsoft bought Ozzie's Groove Networks last year.

In addition, Craig Mundie, another CTO, is now chief research and strategy officer and will work with general counsel Brad Smith on intellectual property efforts.

Microsoft said Ozzie will begin working side by side with Gates on all technical architecture and product oversight responsibilities and Mundie will work closely with Gates to take over Microsoft research and incubation efforts.

Gates said he has decided to announce his plan publicly two years in advance to give the business the "time to make a strong transition."

One cynical observer noted this is a "slow-mo transition." Last year, the company segmented the company into three divisions with Windows under co-presidents Jim Allchin and Kevin Johnson; consumer technologies under Robbie Bach; and business software under Jeff Raikes.

Gates said that when he and Paul Allen started Microsoft 30 years ago, he never imagined "what an incredibly important company" Microsoft would become.

"I have one of the best jobs in the world," he said. "I love software and I love working with smart...passionate people at Microsoft. Together we built a great company."

For the past several years, Gates has devoted more time and energy to the foundation, which focuses on world health and education issues.

Martin Tarr, CEO of Tiburon Technologies, an Independence, Ohio, Microsoft partner, said Microsoft is in good hands. "Ozzie has a reputation for being one of the best programmers and technology people in the business," he said. "I think he was specifically recruited by Microsoft to take over for Gates. It's my guess this plan was put in place over a year ago. This is a well thought out succession plan, which is good for everybody."

Lance Russell, director of marketing and alliances for Pointbridge, a Chicago integrator specializing in Microsoft technologies, concurred. Ozzie has "brought tremendous focus and vision on [software-as-a-service]," he noted.

Others say the company, despite its repeated claims of innovation, has struggled to come up with compelling products in the past several years and suffers in comparison to Google, Apple, and others. Its Windows Live and Office Live efforts, cited several times on Thursday's call, are its call to arms in the SaaS space, and Ozzie has been front and center of that charge. He spoke Sunday night about business opportunities for Windows Live at Tech Ed 2006 in Boston.