Shareholders Want Satya Nadella to Kill Xbox, Bing and Surface


Satya Nadella is officially the new Microsoft CEO as of February 4, 2014, and even though only one day has passed since his appointment, he’s now confronted with the first problems. Two influential Microsoft shareholders are trying to convince the board to get rid of three of the company’s products, including Xbox, Bing, and Surface. The decision would at some level make sense because these investors are reportedly asking the board to push Microsoft to its profitable business, namely the enterprise software industry that’s producing so much money for the Redmond based company. Of course, it’s too early to talk about Nadella’s position on this, but it’s pretty clear that the company isn’t yet ready to give up on these three products, especially after it invested so much money in each of them. What’s more, Xbox, Surface, and Bing are also said to be key parts of Microsoft’s transformation plans to devices and services, so it’s very unlikely to see them going dark. Another reason that stands by the idea of keeping these three products is Nadella’s strong relation with both Steve Ballmer and Bill Gates. While Gates will return to Microsoft to work together with Nadella, Ballmer is said to be one of his main supporters, so it’s pretty hard for the new CEO to revert some of the decisions that his predecessors made while at the company, including the launch of these three projects. And still, everybody expects growing tension at Microsoft in the coming years, especially because ValueAct Capital, the company that recently purchased a hefty stake in the software giant, will have its own man in the board in the person of Mason Morfit. ValueAct is one of the investors that have asked for a more enterprise focused business, calling for Steve Ballmer to sell or retire products such as Bing or Xbox. At the same time, they are pressuring for an expansion of the Office business, as they want the productivity suite to launch on new platforms as soon as possible. It remains to be seen whether Satya Nadella has what it takes to cope with all these internal disputes, but with Bill Gates beside him to give advices on new products and devices, everything should be alright. At least, for now.