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Microsoft to reorganise this week

Microsoft to reorganise this week

Microsoft is reportedly expected to announce a company-wide reorganisation this week which will see the U.S. software giant realign its operations to focus more heavily on the needs of customers and software developers and place less emphasis on products and technologies.

The restructuring efforts were initiated by Microsoft President Steve Ballmer, according to a report in last weeks Wall Street Journal.

At present, Microsoft is split up into four main operating groups -- the sales and support group headed up by Ballmer; the platforms and applications group run by Group Vice President Paul Maritz; the interactive media group also run by Ballmer since the resignation of Group Vice President Pete Higgins in November of last year; and the worldwide operating groups under the leadership of Executive Vice President and Chief Operating Officer Bob Herbold.

In terms of the likely company reorganisation this week, Microsoft is expected to announce two executives to head up its interactive media group, according to the Wall Street Journal report. The group includes the company's Web portal MSN (Microsoft Network). The group may well be renamed as Microsoft's consumer division, the report added.

The duo that could potentially head up the interactive media group may well be existing Microsoft executives Jon DeVaan, currently responsible for development of the company's Office applications suite and Brad Chase who oversaw the launch of both Windows 95 and Internet Explorer, the Journal said.

Also potentially on the move inside Microsoft is Maritz who may head up a new company division, Microsoft's fifth, designed to meet the needs of software developers, the report said.

Jim Allchin, presently in charge of Microsoft's personal and business systems group which is part of the platform and applications group, will head up an enterprise unit with the remit to sell products to CIOs (chief information officers), according to the Journal. Allchin will also continue to oversee the development of the company's operating systems -- both the upcoming Windows 2000 (formerly known as NT 5.0) and the replacement for Windows 98.

Much of the present applications group with Robert Muglia in charge will become a new unit honing in on the needs of knowledge workers as well as continuing to update Microsoft's Office and BackOffice software suites and ensuring higher levels of integration between their respective software constituents, the report said.

In other Microsoft news, the company's Chief Financial Officer Greg Maffei announced late yesterday that there would be a $US400 million shortfall in revenue in the company's current financial quarter due to a lag in the expected release date of the Office 2000 applications suite, reports said on Friday. Microsoft expects to make up the shortfall in its third quarter via increased investment income, reports quoted Maffei as saying.

The company's third fiscal quarter is due to end on March 31, 1998, and the $US400 million will be deferred until its fourth fiscal quarter. The money can only be recognised as revenue once end-users are able to redeem coupons for Office 2000 which they received when they bought Office 97, the reports said. Office 2000 was originally due to be released by the end of March, but is now expected to appear in the second quarter of this year.

Microsoft officials were not available to comment on the reports.


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