Ballmer Q&A: Online Extra

Microsoft Chief Executive Steve Ballmer was quick to answer yesterday when I asked him whether the company's newly announced corporate reorganization, establishing three larger Microsoft divisions with their own presidents, could be a possible prelude to spinning off any of them as a separate company. The answer wasn't among the excerpts included in this morning's Q&A, in part because there wasn't much to it.

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"No," he said. "Absolutely not."

Along those lines, I've heard some people in the industry wonder aloud whether Microsoft would have been better off in the long run if the antitrust breakup of the company had gone through as originally proposed -- creating two independent companies, focused on operating systems and applications, each able to follow its own aims without worrying about the interests and strategies of the other. It's interesting, in that context, that the latest changes create two divisions focused on platforms and applications. Acknowledging the huge difference -- namely, that the divisions are still part of the same company -- I asked Ballmer whether the restructuring in some small way achieves one of the effects of the proposed antitrust breakup.

In short, Ballmer's answer was no to that, as well. Those two companies would have had "no financial reason to cooperate in the customers' best interest," he said. The new divisions still have "one common financial interest that we can apply against one common set of customer interests, and there are customer interests that still span these divisions, absolutely."

Microsoft held an internal webcast yesterday in which Ballmer and Bill Gates answered employee questions. The company didn't let reporters listen in, but the anonymous Mini-Microsoft blogger, now of Business Week fame, gives a sense of the tone in this post -- asking why Ballmer and Gates weren't more blunt in their explanations of the reasons for the change.

Regarding Ballmer & Gates' take on the reorg: why does it all have to be forward looking, positive reasons for doing the reorganization? What's wrong with a little bit of backward looking honesty as to why it was best to do a reorganization? Was Windows a mess? Was MBS adrift and in need of a strong Office integration strategy? Were mistakes made? Admit at least there were and are problems and that the reorganization is going to be effective in dealing with those problems and that executive management will be held accountable for making sure that is so.