Speculation over the new head of Microsoft after Steve Ballmer announces departure

No clear front runner in race to succeed Steve Ballmer, who has announced he is quitting

PUBLISHED : Sunday, 25 August, 2013, 12:00am
UPDATED : Monday, 26 August, 2013, 9:26am

Guessing who might replace Steve Ballmer has always been something of a parlour game for Microsoft watchers.

And now Ballmer's departure is pending, the answer to who will follow him remains as much a mystery as ever.

There is no single clear successor to a lightning rod of a leader who remains one of the most identifiable CEOs in the country.

The search committee will consider internal and external candidates to replace Ballmer, 57, who will depart within the next 12 months.

The once-deep bench of likely successors has been largely drained in the past several years.

Executive vice-president Qi Lu, Tony Bates, the executive vice-president of business development, Satya Nadella, (cloud and enterprise group) and Terry Myerson (operating systems) are the leading choices among Microsoft's executives.

"It would be a difficult job, but if you could turn around Microsoft you'd be seen as a hero," said Brendan Barnicle, an analyst at Pacific Crest Securities.

Industry insiders immediately began to place bets on which executives inside and outside Microsoft - and even outside the technology industry - could be tapped.

The decision will go a long way to determining whether Microsoft will successfully make the transition to mobile computing and computing in a virtual cloud of data-storage devices.

Speculation about external candidates included Sheryl Sandberg, chief operating officer of Facebook; Reed Hastings, chief executive of Netflix and a former director at Microsoft; Scott Forstall, who ran iOS at Apple until last year; and John Legere, CEO of T-Mobile.

Whoever gets the job will face a list of challenges that recently has grown longer.

Last month the company reported profit that missed analysts' estimates by the biggest margin in at least a decade amid weakening demand for PCs running its Windows software.

Even though Ballmer had indicated he was going to retire when the youngest of his children went to college, which was in about two more years, "I think people thought Ballmer would maybe die with his boots on in that role", said Michael Cusumano, a professor of business and engineering at the Massachusetts Institute of Technology.

For some investors, the most important thing is replacing Ballmer with a leader who will help the company re-emerge as a technology pioneer rather than just a follower.

"You need someone who doesn't need to be as much of an operations person as Steve Ballmer, who can say where Microsoft needs to be five years from now," said Microsoft investor Michael Obuchowski, a fund manager at North Shore Asset Management, New York.

McClatchy Tribune, The New York Times, Bloomberg, Reuters