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Why Gates Stepped Down

That nasty old antitrust trial may have accelerated Ballmer's rise to Microsoft CEO.

  

Changes in Store

Recasting Microsoft is vital for the company's continued survival, according to Enderle. "The bottom line is that Microsoft has to become an Internet provider of technology. The company will look dramatically different over the next five years, and it has very fundamental and deep changes to address," he said.

Enderle also predicted that once Microsoft launches its Windows 2000 operating system next month, there will be "another wave of departures" from the company of high-level executives who feel that their work at the firm is now done.

"Once the company stabilizes again, Microsoft will completely rearchitect its products and the way it sells them," moving away from its focus on selling shrink-wrapped software, Enderle said. "If it's possible to do [rearchitecting the company], then Microsoft will do it. The question is whether it is possible," he added.

Microsoft's main business today is still centered on the PC and designing PC applications, Le Tocq noted.

Other companies creating Web-based applications are not encumbered by the need to link to existing PC architecture in the way that Microsoft is, he added. "The announcement is the old Microsoft FUD [fear, uncertainty, and doubt] and rests upon three legs--controlling the document interchange format, controlling the developers and controlling the platform," Le Tocq said.

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