Certainly the two go back a long way. Mr Gates watched as Apple was
established in 1976, a year after his own company, sparking a race
between the two technology chiefs to see who could launch the best
products. He also watched as Mr Jobs was ejected from the business he
founded, only for Apple to crumble and beg him to return as an advisor.
Finally, Mr Gates watched as Mr Jobs reinvigorated Apple as chief executive, and built it into a company that not only eclipsed Microsoft, but briefly ranked as the largest public business in the world.
Arguably, the Microsoft founder is taking a leaf out Mr Jobs’ book now. He has formally stepped down as chairman of the Seattle computer giant, but rather than weakening ties, he is ready to roll his sleeves up and re-boot the business he founded.
He will remain on the board as “founder and technology advisor” and return to Microsoft for an estimated three days a week, “shaping strategy and product direction”.
READ: Bill Gates needs to make Microsoft aspirational again
“You cannot underestimate the importance of this,” said Dan Lavin, head of consultancy firm Silicon Valley Ventures, who has worked with Mr Gates in the past. “Bill being there three days a week is, to my mind, the same as him taking over again, but without the giant disruption of him actually taking the reins.
“Think of it this way: how many days a week was Bill in the office when he was chief executive? Not much more than three. He is the technology advisor when there is only, essentially, technology at Microsoft.”
There is no doubt that Microsoft needs a shake-up. It used to be the largest technology company in the world, thanks to its ubiquitous Windows software, but over the past decade it has lost considerable ground to rivals such as Apple and Google. During the last 17 years that Steve Ballmer was chief executive, it has lost around a third of its value, and earned a reputation for being technologically sluggish.
Microsoft was too slow to produce hardware that tried to rival innovations like Apple’s iPad, and when it did – with the Surface tablet – its efforts fell short.
Mr Gates’ return to the coal face is likely to boost morale among Microsoft employees, many of whom still regard him as a hero, if not an icon. He may have cut his teeth in a very different era for technology, but, insiders say, he remains “the smartest guy in any room”.
Shareholders might have a harder time buying into the “Bill Gates resurgence” story, however. He has done little to intervene over the past 17 years, as the business ran into difficulties, preferring to focus on his charitable foundation and leave Microsoft to Mr Ballmer, a close friend and major shareholder. Few other chief executives would have survived as long as Mr Ballmer did given Microsoft’s performance.
Microsoft threw a sop to investors on Tuesday by appointing John Thompson, the former chief executive of Symantec and Microsoft’s lead independent director, as chairman of the board. However, that is the only real injection of outside blood in the mix.
Mr Ballmer will remain on the board, while Satya Nadella, a Microsoft executive for the past 22 years, takes the helm as chief executive. Mr Nadella previously headed Microsoft’s so-called “enterprise” computing division, which produces technology for businesses, as well as its cloud operations, which are used for everything from storing data for large corporations to hosting Xbox games.
He was quick to demonstrate a new, more open style of leadership on Tuesday. In a video interview, he discussed his wife, children and feelings about getting the Microsoft job before getting to the meat of the business. When he did, he said he wanted to sweep away any obstacles that stop individuals in the company from innovating.
But although Mr Nadella is well respected within Microsoft, he remains a relatively low key figure and it is hard to imagine how he will operate effectively alongside the higher profile Mr Gates. Sources close to the business were incredulous that Mr Nadella would ever be able to overrule the Microsoft founder if they take opposite views in meetings.
That does not make Mr Nadella a figurehead, however. Instead, sources likened him to Tim Cook, the Apple chief who first spent years as chief operating officer under Mr Jobs. “He was very, very powerful, even when Jobs was in charge.”
What’s more, having Mr Gates on site as his backer, makes him virtually unassailable to internal revolts.
However the power games play out, Mr Gates’ return to the Microsoft machine is expected to usher in a new era at the business, reigniting its old rivalry with Apple, as well as some new ones with the likes of Google and Amazon. But while the competitive tensions are old, dating back to the early days of the friendly rivalry between Mr Gates and Mr Jobs, that doesn’t mean the Microsoft chief’s plan of attack will belong to the last century as well.
“Gates wouldn’t come back if he didn’t think he would do something very substantive,” says Mr Lavin. “I believe he will do something very different. He has the strong potential to turn Microsoft around.”
Finally, Mr Gates watched as Mr Jobs reinvigorated Apple as chief executive, and built it into a company that not only eclipsed Microsoft, but briefly ranked as the largest public business in the world.
Arguably, the Microsoft founder is taking a leaf out Mr Jobs’ book now. He has formally stepped down as chairman of the Seattle computer giant, but rather than weakening ties, he is ready to roll his sleeves up and re-boot the business he founded.
He will remain on the board as “founder and technology advisor” and return to Microsoft for an estimated three days a week, “shaping strategy and product direction”.
READ: Bill Gates needs to make Microsoft aspirational again
“You cannot underestimate the importance of this,” said Dan Lavin, head of consultancy firm Silicon Valley Ventures, who has worked with Mr Gates in the past. “Bill being there three days a week is, to my mind, the same as him taking over again, but without the giant disruption of him actually taking the reins.
“Think of it this way: how many days a week was Bill in the office when he was chief executive? Not much more than three. He is the technology advisor when there is only, essentially, technology at Microsoft.”
There is no doubt that Microsoft needs a shake-up. It used to be the largest technology company in the world, thanks to its ubiquitous Windows software, but over the past decade it has lost considerable ground to rivals such as Apple and Google. During the last 17 years that Steve Ballmer was chief executive, it has lost around a third of its value, and earned a reputation for being technologically sluggish.
Microsoft was too slow to produce hardware that tried to rival innovations like Apple’s iPad, and when it did – with the Surface tablet – its efforts fell short.
Mr Gates’ return to the coal face is likely to boost morale among Microsoft employees, many of whom still regard him as a hero, if not an icon. He may have cut his teeth in a very different era for technology, but, insiders say, he remains “the smartest guy in any room”.
Shareholders might have a harder time buying into the “Bill Gates resurgence” story, however. He has done little to intervene over the past 17 years, as the business ran into difficulties, preferring to focus on his charitable foundation and leave Microsoft to Mr Ballmer, a close friend and major shareholder. Few other chief executives would have survived as long as Mr Ballmer did given Microsoft’s performance.
Microsoft threw a sop to investors on Tuesday by appointing John Thompson, the former chief executive of Symantec and Microsoft’s lead independent director, as chairman of the board. However, that is the only real injection of outside blood in the mix.
Mr Ballmer will remain on the board, while Satya Nadella, a Microsoft executive for the past 22 years, takes the helm as chief executive. Mr Nadella previously headed Microsoft’s so-called “enterprise” computing division, which produces technology for businesses, as well as its cloud operations, which are used for everything from storing data for large corporations to hosting Xbox games.
He was quick to demonstrate a new, more open style of leadership on Tuesday. In a video interview, he discussed his wife, children and feelings about getting the Microsoft job before getting to the meat of the business. When he did, he said he wanted to sweep away any obstacles that stop individuals in the company from innovating.
But although Mr Nadella is well respected within Microsoft, he remains a relatively low key figure and it is hard to imagine how he will operate effectively alongside the higher profile Mr Gates. Sources close to the business were incredulous that Mr Nadella would ever be able to overrule the Microsoft founder if they take opposite views in meetings.
That does not make Mr Nadella a figurehead, however. Instead, sources likened him to Tim Cook, the Apple chief who first spent years as chief operating officer under Mr Jobs. “He was very, very powerful, even when Jobs was in charge.”
What’s more, having Mr Gates on site as his backer, makes him virtually unassailable to internal revolts.
However the power games play out, Mr Gates’ return to the Microsoft machine is expected to usher in a new era at the business, reigniting its old rivalry with Apple, as well as some new ones with the likes of Google and Amazon. But while the competitive tensions are old, dating back to the early days of the friendly rivalry between Mr Gates and Mr Jobs, that doesn’t mean the Microsoft chief’s plan of attack will belong to the last century as well.
“Gates wouldn’t come back if he didn’t think he would do something very substantive,” says Mr Lavin. “I believe he will do something very different. He has the strong potential to turn Microsoft around.”
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