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Monday, July 14, 2008

Bill Gates to sign off at Microsoft


Bill Gates is spending his last day at Microsoft Friday before turning his attention full time to philanthropy after decades spent building the US software colossus.

The Microsoft co-founder, 52, known for his boyish face and nerdy manner, will spend his final day at the software giant he helped found over 30 years ago.

Paul Allen, who teamed up with Gates to start Microsoft in a garage in 1975, will be among those “roasting” his childhood friend at a gala dinner on Friday night.

After decades devoted to Microsoft, Gates plans to turn his attention full time to the philanthropic Bill & Melinda Gates Foundation he established with his wife.

Gates leaves Microsoft to wrestle with a fast-changing computer era and growing challenges from Internet juggernaut Google and longtime rival Apple, which makes Macintosh computers.

Three people will essentially fill the void Gates leaves behind at Microsoft.

Gates’s job as chief software architect is being handled by Ray Ozzie.

Craig Mundie inherited Gates’s chief research and strategy officer duties, while former Harvard University classmate Steve Ballmer is chief executive officer of the Redmond, Washington-based software firm.

Gates remains chairman of the Microsoft board of directors and its largest shareholder.

Microsoft is losing Gates at a time when “cloud computing” is shaking the packaged software foundation on which the company’s fortune is built.

Cloud computing refers to a trend in which firms such as Google and Salesforce.com let people use programs on the Internet instead of having to install and maintain software on their own computers.

Microsoft competes in the “software as a service” arena but tends to combine offerings with packaged products in a “software-plus” marketing model, according to analysts.

Meanwhile, Microsoft’s Windows Vista operating system released in January of 2007 has flopped with customers, many of whom are clinging to its predecessor Windows XP.

Vista loathing is heightening interest in free Linux open-source software and Macintosh computers, which use operating systems built by Apple.

Rivalry between Microsoft and Apple is legendary in Silicon Valley. Apple ads and press conferences take swipes at Microsoft, and devotees of competing systems routinely swap barbs in cafes and other social venues.

The culture-shifting popularity of Apple’s iPods and iPhones is credited with increasing interest in Macintosh machines.

While Windows is still used on 90 percent of the world’s computers, Macintosh computers have grown to more than five percent of the market.

Microsoft began selling Zune brand MP3 players in September of 2006 to compete with Apple’s market-dominating iPods, but the devices haven’t been a hit with customers.

Microsoft appears to have failed in a recent bid to buy Yahoo for nearly 50 billion dollars in order to combine online resources to better battle Google in the booming Internet search and advertising sectors.

Microsoft’s server and tools division is its most profitable unit. Its entertainment unit, which sells Xbox videogame consoles and gaming software, has yet to make a profit.

Gates is expected to maintain the ears of Microsoft leaders.

“At some point the firm has to take the essence of what made Bill Gates successful and make sure that is preserved,” said analyst Rob Enderle of Enderle Group in Silicon Valley.


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