Microsoft President Abruptly Steps Down

Microsoft President and chief operating officer (COO) Rick Belluzzo abruptly announced his resignation yesterday after just a year on the job. The announcement about Belluzzo's departure accompanied news of yet another corporate reorganization, one that will give the company's major business units more direct responsibility for their fiscal and operational performance. As the dust settled on this unexpected development, rumors persisted that Microsoft forced out Belluzzo because of its subscription-based software program's slow progress. However, other theories suggest that Belluzzo--who was being groomed for the number-one job whenever Microsoft CEO Steve Ballmer eventually stepped aside--didn't agree with the restructuring plan and felt that it left him with too little responsibility.

"Given where Steve and I knew we needed to take the business, I decided it was the right time to pursue my goal of leading my own company," Belluzzo said in a statement released yesterday.

In a separate statement, Ballmer stated that "Rick has worked closely with me analyzing the company's structure to determine how we could improve our internal processes and maximize opportunities for growth. We realized we needed to give our core leaders deeper control and accountability in the way they run their businesses, while at the same time ensuring strong communication and collaboration across the business units. This is the right decision for Rick, but the company will certainly miss his leadership and experience."

Regardless of the internal machinations that led to his departure, Belluzzo's stay at Microsoft was brief. He joined the company in September 1999 and held several executive-level positions before his promotion to president and COO in February 2001. Microsoft said in a statement that Belluzzo will remain with the company through September to help organize the transition, but he'll relinquish his presidential and COO duties in May. The company says it has no plans to replace Belluzzo.

A Microsoft spokesperson said that Microsoft carried out the reorganization to make the company more "nimble." Microsoft will now consist of seven major business units: Windows Client, Knowledge Worker, Server and Tools, Business Solutions, CE/Mobility, MSN, and Home and Entertainment.

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