Friday, January 11, 2008

Microsoft President Raikes Retiring, Replacement Comes From Outside

Chairman and co-founder Bill Gates isn't the only one on his way out at Microsoft (NSDQ: MSFT). Business division President and long-time Microsoft employee Jeff Raikes is retiring in September, being replaced by Stephen Elop, the now former chief operating officer of Juniper Networks.

Raikes' last hurrah as business division president will be next month's launch of Windows Server 2008, SQL Server 2008, and Visual Studio 2008. He's one of Microsoft's longest serving employees, having joined the company in 1981 as a product manager.

"I've had an incredible journey here at Microsoft," Raikes said in a statement. "Given the success of our business and the depth of leadership we have in place, the time is right to leave the business in the capable hands of our new generation of leaders."

Raikes looked like a potential successor for Microsoft CEO Steve Ballmer, should he retire, having helped grow the Office brand in Microsoft's early days and, more recently, turned Microsoft's business division into a cash cow. Raikes has overseen a doubling of Microsoft business division's annual revenue, including 21 consecutive quarters of double-digit growth in the company's Server and Tools Business.

Replacing Raikes, Elop brings formidable technology experience to Microsoft. In addition to serving as Juniper's COO, Elop was president of Adobe's worldwide field operations after a stint as Macromedia's CEO.

Elop's background serves as a bit of a template for the direction Microsoft is moving. His experience with Macromedia and Adobe make him a good candidate to lead an Internet services push in product areas like Microsoft Office, while his recent job with Juniper places Elop to help Microsoft take on Cisco in the emerging field of unified communications.

At least during the transition phase from Raikes to Elop, Microsoft senior VP Bob Muglia, who heads up the company's server and tools business -- that includes products like Windows Server and Visual Studio -- will report directly to Ballmer.

Raikes is one of a few executives to announce their departure from the company this week. Charles Fitzgerald, Microsoft's general manager for platform strategy, is also leaving the company, a Microsoft spokesman said Thursday. And on Wednesday, Microsoft said merger and acquisitions chief Bruce Jaffe would be leaving the company next month.