Steve Ballmer Announces Retirement From Microsoft; Like Yahoo, Will A Google Engineer Replace Him?

Microsoft said Friday that long-time CEO Steve Ballmer would retire from Microsoft within the next 12 months after the company chooses a successor. One analyst chimes in with a recommendation for a replacement.

Innovation remains the biggest missing asset at Microsoft, according to analysts. Bing also lacks market share, although there have been ongoing attempts to increase ad investments that can change the landscape. Many believe the company needs new engineering blood at the helm. Perhaps the company should consider Yahoo board's decision to name Marissa Mayer CEO. She began her career as a Google engineer.

Similarly, before joining Google to eventually become senior vice president of engineering, Vic Gundotra held the role of general manager at Microsoft. In a research note, Trip Chowdhry writes: "Vic Gundotra (from GOOG) will be an ideal CEO for Microsoft and may be a good replacement to Steve Ballmer" because he may help Microsoft compete with new IT players such as Google,, Pivotal and VoltDB."

DataPop founder Jason Lehmbeck said while there are many unknowns, Bing and the Microsoft advertising divisions have had some successes, but they have shown no signs of truly breaking out from a distant second place despite significant investments in each division. A new CEO is likely to bring a fresh perspective to the important question of whether Microsoft's mission should include search and advertising technology, he said.

Microsoft was founded by Bill Gates and Paul Allen in 1975, but Ballmer held the position of CEO since 2000. He ran across some tough years as the tech industry transitioned from software to Web services -- not building Web services, but transitioning from software on the machine to client-based applications like mobile apps.

Bing has made strides in the past six months to a year, proving to agencies like Marin Software that they are investing in search technology. "I don't know what it means to advertising or long/short term impact," he said.

Some call apps a disruptive technology for Microsoft. The Washington Post reporter Timothy Lee tells us: "Ballmer was hardly oblivious to the threat posed by Web and mobile apps. To the contrary, he has spent the last decade working feverishly to position Microsoft to respond effectively. Microsoft has poured hundreds of millions of dollars into its search, map, e-mail and other Web apps."

It's sad, but a reality, that analysts like David Einhorn and many investors can't see past the dollar signs to marvel over Microsoft's innovations.

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