Microsoft Board criticizes CEO Steve Ballmer for weakened smartphones, Windows

Posted:
in General Discussion edited January 2014
After conducting an annual performance review of Microsoft CEO Steve Ballmer, the software giant's Board of Directors took him to task for poor sales of its Windows Phone 7 operating system, dampened Windows revenue and the "need for further progress" with new form factors, awarding him just half of his maximum yearly bonus.



The Redmond, Wash., company filed documents with the U.S. Securities and Exchange Commission on Monday detailing the review. Reuters pointed out that Ballmer's bonus of $682,500 for the most recent fiscal year matches his target award of his annual salary. But, the compensation is just half of the maximum prescribed.



The Board noted in its review of the executive that it took into account the fact that initial sales of Windows Phone 7 had been "lower than expected." Ballmer himself said earlier this year that sales of WP7 devices had gone from "very small to very small."



Microsoft directors also considered the 2 percent decline in revenue for the Windows and Windows Live Division had taken place under Ballmer's watch last year. In what has been perceived as a nod to rival Apple's iPad, the Board mentioned "the need for further progress in new form factors" in its review of him.



On a more positive note, Ballmer was given credit for successful product launches including Kinect and Office 365, key partnerships with Facebook and Nokia, and overseeing an "overall strong financial year" with record reported revenue and record operating income.



Ballmer's total compensation from Microsoft in fiscal 2011 totaled roughly $1.37 million, lower than some of his colleagues because he has declined awards in the form of stock. The company's board notes that Ballmer is "underpaid for his role and performance," while noting that he has a significant stake in the company. According to Forbes, Ballmer has a net worth $13.9 billion as of September 2011, with the majority of his wealth derived from his stake in Microsoft.







The Board's critiques remain similar to comments it made about Ballmer last year. In his 2010 review, they called out "the unsuccessful launch of the Kin phone; loss of market share in the company's mobile phone business; and the need for the company to pursue innovations to take advantage of new form factors" as weak points of his performance. Ballmer was also awarded just 50 percent of his total maximum bonus in 2010.



Microsoft's struggles in the mobile space stand in stark contrast to the meteoric rise of long-time competitor Apple's iPhone and iPad. In just a few years, the two devices have grown to become the bulk of the company's revenue.



The Windows maker has also struggled with its Zune players meant to challenge Apple's iPad. On Monday, all references to Zune hardware temporarily disappeared from Microsoft's website. The references eventually were re-added to the site, but the company has announced that it will "no longer be producing Zune players."
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Comments

  • Reply 1 of 53
    asciiascii Posts: 5,941member
    I'm surprised he only got 1.37m. I just assumed Ballmer was getting more than that.



    They were right not to give him his whole bonus, but I still regard MS as a bigger threat to Apple long-run than Google/Android.



    If they hadn't let their software stack bloat so much (e.g. .NET), and stuck with something fast like C, they could have had a smartphone OS based on largely the same API set as their desktop, as Apple achieved.
  • Reply 2 of 53
    Ballmer should be giving back 1.37m instead, seeing as how he does everything backwards.
  • Reply 3 of 53
    solipsismsolipsism Posts: 25,726member
    Quote:
    Originally Posted by MacQuest View Post


    Ballmer should be giving back 1.37m instead, seeing as how he does everything backwards.



    He's isn't been highly effective in the ways I would have expected from MS, but MS has turned a healthy profit each and every quarter. That in itself should be worth more than $1.37M a year. That said, MS really needs some new blood in the company and I expect this is the beginning of the end of his reign as CEO.
  • Reply 4 of 53
    Mr. Steve Ballmer is a great leader . He has done such a fine job as MSFT CEO that he continue to unite both MSFT and AAPL supporters and both groups love Mr. Steve Ballmer a lot
  • Reply 5 of 53
    hmmhmm Posts: 3,405member
    Quote:
    Originally Posted by solipsism View Post


    He's isn't been highly effective in the ways I would have expected from MS, but MS has turned a healthy profit each and every quarter. That in itself should be worth more than $1.37M a year. That said, MS really needs some new blood in the company and I expect this is the beginning of the end of his reign as CEO.



    I'm not sure he really cares about the salary. Did you note his estimated net worth? Even if the bulk of that is in Microsoft stock he can be considered independently wealthy. If you read the article he declined further payment in the form of further stock options.
  • Reply 6 of 53
    jonamacjonamac Posts: 384member
    This is what sleepwalking looks like. The bottom line is good so they don't change anything.



    For me, Microsoft have lacked vision at one of the major turning points in their industry's history. Ballmer laughed at the first iPhone. That showed something. He didn't see what was coming. Dramatically so.



    The Zune failed, the Kin failed (to put it mildly), WP7 has so far failed (it remains to be seen if Nokia can help that but Nokia are hardly having their finest hour either right now), Windows Vista was on this guy's watch. In the time since Ballmer took over Apple have overtaken Microsoft in key ways.



    Microsoft's biggest product, Office, has virtually no monetized presence on a mobile device as the PC market shrinks. It cannot command the same retail price as it once did on the desktop either.



    They have needlessly separated their various architectures so that WP7 bears no resemblance to Windows 7 or Windows Phone 6.5, limiting developer support.



    The impression I have of Microsoft right now is of a ship in the fog; it doesn't know where it's going so it just keeps on the same heading and hopes it'll all come good. Apple have clear vision of where they are going. Google seem to, although i suspect they 'wing it' a heck of a lot but they can afford to because of the strength of their core search/advertising business.



    Microsoft need vision. They're too corporate. They have the brand and the connections to be a huge player but so far they've looked tired and out of the game since the iPhone and Android came along. Things look ok on the balance sheet right now, but they have got to get back in the game if it's going to stay that way.



    They now have a mountain to climb to get people to leave the App Store/Android Market system they have invested in, because they were too late.



    We never got the Zune HD over here in the UK (I don't think anyway!) but we're expected to know what Zune means on our Xboxes? What is Zune? It's a stupid name for a service that never had an identity. Is it a player, is it a service? My point is that Microsoft seem completely unaware that nobody has any idea what Zune is outside the US. It just seems incompetent for a company of their size and little things like that make me just feel they lack cohesive, visionary direction at that top.



    Windows 8 will be a huge release for them, one way or another. If that bombs, then alarm bells will really ring around Redmond. It will show that Windows has no future on tablets or phones and therefore no platform for Office as the desktop PC fades in importance. They would have to re-engineer much of the company. IF.
  • Reply 7 of 53
    At this point in time, I have little interest in the well being of Microsoft. Having said that, they seriously need to kick this sorry sack of hot air out. That is if they want someone who's going to keep the company in business.
  • Reply 8 of 53
    Churlish or not, I think it's time to remind people of this!



    Ballmer laughs at the iPhone
  • Reply 9 of 53
    It's no wonder the prospect of selling Windows appealed to Ballmer... He acts like a dodgy double glazing salesman.
  • Reply 10 of 53


    Hope they never fire him.
  • Reply 11 of 53
    jumejume Posts: 198member
    I wonder how it looks on your personal bank account printout when someone transfers you 1.37M$ .
  • Reply 12 of 53
    nchianchia Posts: 123member
    As a multi-billionaire, you wonder if a mere mil or two will motivate him much.
  • Reply 13 of 53
    I was thinking of laughing at Ballmer when I read this news and then I wondered why I needed to laugh. I use a MBP for work (even though I need to work with .NET) & I use an iMac for my home. Between my wife and I, we have all iterations of the iPhone and the iPad. I bought my wife a MBA and I use a Time Capsule for backup. I love my iPod. That makes me a fan of Apple products and I admire Steve Jobs. But I think laughing at Microsoft, or any other company for that matter, seems like the "Ha! Ha!" kid on The Simpsons.



    I am not taking a moral high ground. I just felt that I have no vicarious need to see Ballmer fired, or Microsoft fail, or Android disappear, or Google killed, or Samsung crash. I love reading everything that AI puts up and love reading posts by the grammar police, the DED stalkers and the trolls. But now, I feel sorry for someone like Ballmer. Not that he needs it.



    I think, what I'm trying to say is ... ah f* it.... Ballmer - ha! ha!
  • Reply 14 of 53
    aaronjaaronj Posts: 1,595member
    Quote:
    Originally Posted by broadbean View Post


    As a multi-billionaire, you wonder if a mere mil or two will motivate him much.



    I think it's a lot like salaries in sports. Take baseball, for example. Player X doesn't really care whether he gets $22.5M over the $21M that was offered, from a financial standpoint. He cares because Player Y is getting $21M, and Player X is absolutely convinced that he deserves more than that other guy.
  • Reply 15 of 53
    simtubsimtub Posts: 277member
    Quote:
    Originally Posted by bobborries View Post




    Hope they never fire him.



    That GIF really spooked me out!! But then a few seconds later I LOL'd so loud at work. hahaha brilliant!
  • Reply 16 of 53
    nvidia2008nvidia2008 Posts: 9,262member
    Quote:
    Originally Posted by ascii View Post


    I'm surprised he only got 1.37m. I just assumed Ballmer was getting more than that.



    They were right not to give him his whole bonus, but I still regard MS as a bigger threat to Apple long-run than Google/Android.



    If they hadn't let their software stack bloat so much (e.g. .NET), and stuck with something fast like C, they could have had a smartphone OS based on largely the same API set as their desktop, as Apple achieved.



    Ah, at least there's a sliver of justice in executive pay in the US. Just over 1 mil for the head of Microsoft is pretty paltry on a global scale. But apt for the failure of Microsoft in anything but Windows, Office and Xbox. I swear though whoever is running the Xbox360 division is on a different planet to Microsoft Central. The interface, user experience, gaming experience, console refinement, while not Apple-like, is pretty darn impressive. Kinect is a vastly superior experience to Playstation Move, swinging around that lighted dildo is just... sad. Anyways I'm never going back to PC gaming. Not for the next five years anyway. C'mon Apple, just a few more tweaks to ARM and you'll kill the Xbox360 and it's five-year-old tech. In fact maybe if Apple can pair the ARM with an ATI card it would be sweet. Or AMD's Fusion tech (pity about their fab problems though)... And ATI, my gawd, looks like they will never sort out their driver issues. Maybe ARM-PowerVR will be "the" next-gen console. With all the games and franchises in the pipeline though Xbox360 won't be going anywhere for another few years. Not unless Sony or Nintendo one-up them in a big way... which looks increasingly unlikely at this stage.



    </gamer rant>
  • Reply 17 of 53
    They may be falling in the mobile market but MS is doing well in the enterprise segment! I think that is the reason that Ballmer is in his job. Nonetheless they should try working on the mobile products for the enterprise soon. That is a segment which is not tapped on properly.
  • Reply 18 of 53
    Quote:
    Originally Posted by bobborries View Post




    Hope they never fire him.



    Dude you are my hero!
  • Reply 19 of 53
    cajuncajun Posts: 95member
    Quote:
    Originally Posted by broadbean View Post


    As a multi-billionaire, you wonder if a mere mil or two will motivate him much.



    Not at all, but the action is publicly symbolic of the board's displeasure with him.
  • Reply 20 of 53
    nvidia2008nvidia2008 Posts: 9,262member
    Quote:
    Originally Posted by Jonamac View Post


    Windows 8 will be a huge release for them, one way or another. If that bombs, then alarm bells will really ring around Redmond. It will show that Windows has no future on tablets or phones and therefore no platform for Office as the desktop PC fades in importance. They would have to re-engineer much of the company. IF.



    Xbox360 and Xbox Live is the only thing really cutting ahead in the waters for Microsoft. Zune, WP7, Kin, WinCE, all floundering. Windows and Office is like an oil tanker. Hard to slow down, but also hard to turn around. PowerPoint 2010 was horrible on my colleagues' HP laptops at a recent project I was working on. Obviously I just used Keynote and people were kind of shocked at the difference. Even when at the end of the project I was converting my file to PowerPoint and doing cleanup it PowerPoint 2010 would behave properly on my VMWare Fusion but would encounter all kinds of weird bugs and crashes on a Windows laptop. It's not necessarily the Keynote conversion, because one colleague's laptop was fine and another's was grindy and crashy as anything.



    One one of their laptops I noticed the guy when loading anything from the Windows desktop shortcuts he would constantly right-click and then click "Refresh" to keep refreshing the Windows desktop icons so things would be more responsive.



    I think most average educated office workers that use an iPhone or iPad definitely wants to be able to use a Mac at work.
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