The chief investment officer for Vulcan Capital, the investment arm of Microsoft co-founder Paul Allen, says the company’s next chief executive should look at spinning off its consumer products — including its Bing search engine and Xbox game console.
Paul Ghaffari, who manages Allen’s $15 billion fortune, made the comments this week at the Financial Times Investment Forum in New York, as reported by the newspaper overnight. Ghaffari said Microsoft should focus instead on serving business customers, a traditional strength for the company.
“The search business and even Xbox, which has been a very successful product, are detracting from that. We would want them to focus on their best competencies,” he said, according to the paper. “My view is there are some parts of that operation they should probably spin out, get rid of, to focus on the enterprise and focus on the cloud.”
The comments are notable because of Allen’s history with the company, but Ghaffari isn’t the first to suggest this path. Rick Sherlund, a longtime analyst covering Microsoft, made headlines with his own version of the proposal earlier this year, just the latest to make the suggestion. The problem is that Microsoft’s recent reorganization, led by now-outgoing Microsoft CEO, has made any initiative to spin off businesses considerably tougher.
Allen still has a $2 billion stake in Microsoft, according to the Financial Times.