elop-ballmerA report by Bloomberg News this morning quotes anonymous sources saying that Stephen Elop, the former Microsoft exec and Nokia CEO, would consider making the Office applications available more widely beyond Windows if he succeeds Steve Ballmer as Microsoft’s next CEO. He’d also be open to spinning off the Xbox and Bing businesses, according to the sources.

Then again, maybe not, because he hasn’t finalized his analysis of the Microsoft business, the story says.

“We appreciate Bloomberg’s foray into fiction and look forward to future episodes,” said Microsoft’s Frank Shaw, as quoted in the story.

Whether or not Bloomberg’s premise turns out to be true, the situation reflects how the Microsoft CEO search is playing out in the media, with a series of speculative pieces purporting to convey inside knowledge about the CEO search. I’ve been talking with current and former Microsoft executives about the process, and from what I can tell, the majority of these reports aren’t based on first-hand information from the actual board members who are running the process.

What these stories do have in common is 1) they’re anonymously sourced and 2) they play into popular theories among investors about what the company should do.

Earlier this week, for example, Microsoft’s shares climbed above $38 when longtime analyst Rick Sherlund predicted that Ford CEO Alan Mulally will be named the new Microsoft CEO by December. This was part of an extensive “action plan” for the new Microsoft CEO in which Sherlund reiterated his belief that Microsoft should spin off its Xbox and Bing businesses.

Among other theories, Sherlund suggested that Ballmer “may decide to leave the board, and Microsoft might consider repurchasing his $12B share position,” despite Ballmer’s public statement that he “treasures his Microsoft stock.”

At one point in the analysis, Sherlund acknowledged, “We are just reasoning our way through here.” And yet the stock market reacted as if the reasoning were reality.

This whole thing may be a case of media and analysts running amok, but Microsoft and Ballmer have helped to enable it. Ballmer’s abrupt exit, years ahead of schedule, has combined with a lack of a clear succession plan to set the stage for this awkward limbo period. It can’t be fun to be a Microsoft executive or manager trying to implement a giant reorg in the middle of all this.

Whoever the Microsoft board actually ends up choosing as the next CEO, here’s hoping they’re looking beyond these usual suspects on the “short list,” and that the person they pick has the vision to do something beyond these obvious “solutions.”

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  • Crapgamer

    These “sources” come up at the worst possible time. Stocks and revenue are high for Microsoft and they are two weeks away from launching a new Xbox. I find the timing too suspicious to be coincidence.

    Microsoft obviously has a long term goal with Xbox One, forging partnerships with Steven Spielberg and the NFL for the foreseeable future. Microsoft has always wanted to dominate the living room. There is still so much more they could do in the future with Xbox 360 and Xbox One. I could fully see the Xbox On get subsidized and put into hundreds of millions of homes as a cable box/entertainment system for cable/satellite providers. They could also subsidize it in general and offer a $199 down $15 a month contract option with people like they did with the Xbox 360.

    Hopefully whoever they bring in sees the benefits of the global brand Xbox is now.

    • You are flat out wrong

      When Stephen Elop sees the balance sheets from a brand that’s made a $3 billion total loss over the last decade, when he sees the $400 million wasted on NFL deals and the tens of millions wasted on marketing gimmicks, desperate exclusivity deals, pack in bundles and crap TV shows, when he sees the PS4 smash the Xbone in worldwide sales, Elop, Allen and every tired share holder is going to jettison the Xbox brand so hard, so fast. It’ll be glorious.

      • Crapgamer

        Actually he’s not the CEO of Microsoft and being in the “running” is hardly an assured spot. We’ve already had an official response from Microsoft on the subject.

        “We appreciate Bloomberg’s foray into fiction and look forward to future episodes.”

        Considering record profits, and record setting stocks. There is no way any future CEO does anything but continue to support the Xbox brand which has turned into a giant monster in and of itself.

        I’d worry more about Sony, since they’re taking a bath on PS3 (still), Vita and a loss on every PS4 sold. Have you seen how much money Sony lost last quarter? They are really in a lot of trouble if the PS4 struggles like the Vita and PS3. Don’t get me wrong, I’d hate to see them go out of business because competition is a great thing, but they’ve made a lot of foolish mistakes with their money.

        • You are flat out wrong

          It’s him or Alan Mulally and neither of them have the affection for the Xbox brand like Gates or Ballmer had. Once he sees the balance sheets, he’s cutting off the Xbox tumour for good, especially if the Xbone is in last place again for a third straight generation. The whole project is a distraction when they need their best minds focussed on mobile, tablets and strengthening their OS line after the Windows 8 blunder.

          • Crapgamer

            Keep telling yourself that kid. Didn’t you hear? Xbox One is more than doubling pre-orders of Xbox 360. Xbox 360 had over 660,000 pre-orders, which means Xbox One is going to be at 1.3 million or more by now.

            I don’t think they will dump the Xbox brand. It brings in a ton of money. Over a billion a year with Xbox Live alone. Unlike Sony which is losing money on every PS4 sold, losing money on Vita *what a disaster that is huh?* and still losing money on PS3. I’d wager if PS4 tanks, Sony will be completely out of the console business in the next 2-3 years. As CEO nobody could just “dump” something without a vote. Ballmer and Gates will still be on the board.

            I’m kind of curious as to why you feel the need to reply to everything I post? It’s starting to creep me out a bit. Shouldn’t be have a PS4 about to be coming soon? I’m sure Sony will be finally doing a UI/OS walkthrough for the console coming in 6 days time. Kind of odd we haven’t seen anything from Sony on their console which is about to release.

            Hopefully you’ll be too busy playing indie games to troll for a while.

          • You are flat out wrong

            Am I supposed to be impressed? PS4 hit 1.5 million pre-orders in August. It’ll be 2.5 million now. Xbone gon get B-L-O-W-N O-U-T.

            Xbox has never turned a profit for Microsoft. See: http://www.neowin.net/news/report-microsofts-xbox-division-has-lost-nearly-3-billion-in-10-years

            I can’t help but systematically destroy your crap arguments. You’re such the epitome of the snivelling Xdrone. It’s become a sport. :)

            Here’s a demo of the OS, btw. http://youtu.be/jkz2Sy6bur0?t=4m59s They’re pretty easy to find if you exercise a bit of intelligence.

          • You’re Kind of Wrong

            I hate to break it to you CrapGamer, but the ps3 has been turning a profit for the past few years. And Sony will be making a profit after the purchase of a single new game on the ps4, so pretty much day one. The Android market is the breadwinner for Microsoft and makes more profit than their other electronics including, suprise suprise, Xbox. If you’re going to make these claims, you should at least run a simple fact check.

  • http://www.christopherbudd.com Christopher Budd

    “It can’t be fun to be a Microsoft executive or manager trying to implement a giant reorg in the middle of all this.”

    Indeed. Think of how much fun it is for the real employees who bear the brunt of every reorg.

    To your point though, this is turning into a case study in how not to do a succession.

  • Adam

    is geekwire contributing to the problem by reporting the speculation and the reaction to it?

  • stAn

    All just staging. They’ll announce Mullaly in Q2 of 2014. Ford is ready for it too. As much as it may seem like chaos Ballmer only stepped down because Mullaly nodded.

  • TechnoSpy

    Microsoft would be much better served to look elsewhere. Elop brings nothing new to Microsoft and certainly does nothing to move Microsoft away from its image of severe mediocrity…the legacy that Steve Ballmer leaves behind. If Elop is the best they can do, Ballmer might as well stay.

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