Microsoft looking to restructure; will focus more on devices and services

Microsoft CEO Steve Ballmer is working on restructuring the giant software company, according to a report over on AllThingsD. This shuffling could see several current executives hold more prominent roles. Sources familiar with plans note that the restructuring will focus on solidifying Microsoft into the "devices and services company" that Ballmer previously wrote about in his annual shareholder letter.

We've already witnessed the company slowly move into hardware with its Surface family of Windows 8 tablets, as well as services that include Office 365, and Skype among others. It certainly makes sense for Microsoft to adapt to the demands of today's consumer. Reports note that while plans are being drafted, changes could well change drastically.

As noted above, the new configuration could introduce larger roles for the likes of Satya Nadella, president of the Services and Tools division; Tony Bates, president of the Skype communications division; and Don Mattrick, president of the Interactive Entertainment division. What kind of expansion said executives could see to their current roles remains unclear.

It seems most plausible that changes to the Microsoft organisational structure would centre around devices and services, both in the enterprise and consumer markets, while also simplifying its management. This potential restructuring comes amid increased investor pressure. Nomura Equity Research analyst Rick Sherlund wrote the folowing last week:

"There may be a shift in the wind upcoming for Microsoft, with shareholders potentially demanding a greater say in the direction of the company and how it might be run to drive a better return to shareholders."

Sherlund also suggested that Microsoft consider selling off its Bing search business and the highly popular Xbox unit. It has been disclosed that ValueAct Capital had bought around 1 percent of Microsoft's stock, which Sherlund notes could help push for change. ValueAct’s Jeff Ubben believes Microsoft has much potential and said it "could be the largest cloud company in the world" in a recent speech.

What we can take from here is that Microsoft shares have risen more than 31 percent, further pointing at changes in the wind. What's on the horizon is yet to be seen, but it's an exciting time to be following Microsoft nonetheless.

Source: AllThingsD

Rich Edmonds
Senior Editor, PC Build

Rich Edmonds was formerly a Senior Editor of PC hardware at Windows Central, covering everything related to PC components and NAS. He's been involved in technology for more than a decade and knows a thing or two about the magic inside a PC chassis. You can follow him on Twitter at @RichEdmonds.