Microsoft Promotes Steven Sinofsky to President, Windows Division
Tami Reller to lead Windows Marketing and Finance

REDMOND, Wash. — July 8, 2009 — Microsoft Corp. today promoted Steven Sinofsky to president of the Windows Division. Sinofsky, a 20-year Microsoft veteran, most recently led the Windows and Windows Live Engineering Group, contributing to the Oct. 22 availability of Windows 7.

As president, Sinofsky assumes responsibility for the Windows business including both the engineering and marketing functions for Windows, Windows Live and Internet Explorer.

“Steven Sinofsky has demonstrated the ability to lead large teams that deliver great products. The work he and the team have done in getting ready to ship Windows 7 really defines how to develop and ship world-class software,” said Microsoft CEO Steve Ballmer. “He is a perfect fit to lead the Windows group.”

Sinofsky began his career at Microsoft in 1989 in engineering and has held multiple positions on Microsoft product teams. His full biography can be found here.

In addition, Tami Reller, currently chief financial officer (CFO) for the Windows Division, will take on the additional responsibility for marketing. Bill Veghte will be moving to a new leadership role in the company to be announced later this year. The transition between Reller and Veghte is timed to take place in late July when Windows 7 reaches the release to manufacturing (RTM) milestone.

Reller joined Microsoft in 2001 as part of the acquisition of Great Plains Software Inc. Reller was the CFO of Great Plains at the time of acquisition and had previously served in a number of senior marketing, sales and general management roles. Since joining Microsoft, she has held a variety of leadership positions including corporate vice president of marketing for Microsoft Business Solutions, where she was responsible for the launch of the Microsoft Dynamics brand. She will report to Sinofsky and will retain her responsibilities as CFO.

“In addition to her in-depth knowledge of the Windows business, I’m excited that Tami will bring to Windows her experience in marketing and finance, along with a history of fostering a strong and profitable partner ecosystem in business software,” Sinofsky said.

Jon DeVaan will continue in his role as senior vice president, reporting to Sinofsky. DeVaan managed the engineering team responsible for creating the core components of both Windows 7 and Windows Server 2008 R2.

And now, the all-hands memo from Microsoft CEO Steve Ballmer:

Windows is one of the franchise brands and products for Microsoft. Each new version of Windows is a visible and significant milestone for the company. We will soon finish Windows 7 and hand it off to our partners for general availability on October 22nd.

With this transition, we want to ensure we are setting up for the next release and continue the market leadership and momentum that we have with Windows today. Accordingly, I am pleased to announce today that Steven Sinofsky will be promoted to President of the Windows Division. Windows 7 is receiving terrific feedback from customers, partners, analysts alike, and the entire Windows team has done a great job.

With this promotion, Steven assumes responsibility for the Windows business including both the engineering and marketing functions for Windows, Windows Live and Internet Explorer. Jon DeVaan will continue in his role as senior vice president, reporting to Steven. In this role, Jon will continue to manage the engineering team responsible for creating the core components of both Windows 7 and Windows Server 2008 R2 and is responsible for the PC ecosystem engagement and technical readiness.

We are also pleased to announce today that Tami Reller, currently CFO for the Windows Division, will take on the additional responsibility of marketing for the Windows Division. Tami brings a strong background in delivering successful brands to market, most recently with the introduction of Dynamics in her previous role as marketing vice president for MBS. Tami takes over the marketing responsibility from Bill Veghte who will take a new leadership role in the company to be announced later this year. Bill and Tami will work closely together through this month to ensure we deliver on the momentum currently building for the launch of Windows 7.

Under Bill’s leadership, the team has re-energized our approach to marketing and selling Windows and the PC, built stronger relationships with our partners and has laid the right plans for delivering Windows 7 into the market. In particular, the “I’m a PC” campaign has really helped energize the brand and create emotional connections between our product and our customers. Bill has a long track record of success at Microsoft in a variety of capacities and we look forward to his continued contributions.

As we start the new fiscal year, we do so with a full slate of great products, healthy businesses and strong leadership. We would like to recognize Steven, Bill and Jon for their leadership of Windows and congratulate Tami on her new expanded role.

Steve

Here is the full memo Microsoft CEO Steve Ballmer sent out to the troops about the big changes in its organization, including the departure of Platforms and Services Division President Kevin Johnson, in which he addresses Apple, Yahoo, Google and more:

From: Steve Ballmer
Sent: Wednesday, July 23, 2008 4:30 PM
To: Microsoft–All Employees
Subject: FY09 Strategic Update

I also have news about an organizational change and a transition in our Senior Leadership Team.

First, I want to thank you for your hard work and the dedication you showed during the past 12 months. FY08 was a milestone year. Our revenue jumped $9.3 billion to more than $60 billion. Operating profit grew 21 percent to $22.5 billion.

These outstanding numbers are the direct result of your commitment to the priorities I outlined last July. A lot has happened since then, but our fundamental strengths, challenges, and strategic goals remain largely the same. Therefore, my priorities are consistent with last year. In FY09 we must continue to:

1. Invest in the right opportunities;

2. Expand our presence with Windows, Office, and developers;

3. Drive end user excitement for our products;

4. Embrace software plus services; and

5. Focus on employee excellence.

By focusing on these five areas, we can continue to grow revenue, increase profit, and expand our market share. These priorities are also critical as we work to address key issues surrounding our business in the coming year:

· Windows: The success of Windows is our number one job. With SP1 and the work we’ve done with PC manufacturers and our software ecosystem, we’ve addressed device and application compatibility issues in Windows Vista. Now it’s time to tell our story. In the weeks ahead, we’ll launch a campaign to address any lingering doubts our customers may have about Windows Vista. And later this year, you’ll see a more comprehensive effort to redefine the meaning and value of Windows for our customers.

We also have to drive developers to create rich applications for Windows. With Internet Explorer and Silverlight, we have great tools for creating applications that run everywhere. But we also need to make sure developers have the .NET skills to write unique Windows applications using Windows Presentation Foundation. To keep today’s Windows applications alive, vibrant, and exciting, we need both—applications that run everywhere and rich client applications.

· Apple: In the competition between PCs and Macs, we outsell Apple 30-to-1. But there is no doubt that Apple is thriving. Why? Because they are good at providing an experience that is narrow but complete, while our commitment to choice often comes with some compromises to the end-to-end experience. Today, we’re changing the way we work with hardware vendors to ensure that we can provide complete experiences with absolutely no compromises. We’ll do the same with phones—providing choice as we work to create great end-to-end experiences.

· Business and enterprise: Our enterprise and server business has never been stronger—today we are on the verge of becoming the number one enterprise software company. We need to continue to push on all fronts—mail with Exchange, business intelligence with PerformancePoint, virtualization with Hyper-V, and databases with SQL Server. We have to drive our enterprise search capabilities, our unified communications solutions, and our collaboration technologies. And we must continue to compete against Linux in key workloads such as Web servers and high performance computing.

· Software plus services: Some people think software plus services is all about search. But it’s really about changing the way software is written and deployed. The future is about having a platform in the cloud and delivering applications across PCs, phones, TVs, and other devices, at work and in the home. It’s also about driving change in business models through advertising, subscriptions, and online transactions. Software plus services is a huge opportunity for us to deliver new value on the desktop and the server to all of our customers. This year at PDC, you’ll hear more about our cloud platform initiatives and the next versions of our Live and Online technologies.

· Google: We continue to compete with Google on two fronts—in the enterprise, where we lead; and in search, where we trail. In search, our technology has come a long way in a very short time and it’s an area where we’ll continue to invest to be a market leader. Why? Because search is the key to unlocking the enormous market opportunities in advertising, and it is an area that is ripe for innovation. In the coming years, we’ll make progress against Google in search first by upping the ante in R&D through organic innovation and strategic acquisitions. Second, we will out-innovate Google in key areas—we’re already seeing this in our maps and news search. Third, we are going to reinvent the search category through user experience and business model innovation. We’ll introduce new approaches that move beyond a white page with 10 blue links to provide customers with a customized view of their world. This is a long-term battle for our company—and it’s one we’ll continue to fight with persistence and tenacity.

· Yahoo: Related to Google and our search strategy are the discussions we had with Yahoo. I want to emphasize the point I’ve been making all along—Yahoo was a tactic, not a strategy. We want to accelerate our share of search queries and create a bigger pool of advertisers, and Yahoo would have helped us get there faster. But we will get there with or without Yahoo. We have the right people, we’ve made incredible progress in our technology, and we’ll continue to make smart investments that will enable us to build an industry-leading business.

As I mentioned earlier, I have important organizational news. Today we are announcing that the Platforms and Services Division will be split into two businesses: Windows/Windows Live and Online Services. We are also announcing that Kevin Johnson will leave the company. He will work to ensure a smooth transition.

Since 1992, Kevin has been a key contributor to many of this company’s most important achievements. As president of the Platforms and Services Division, Kevin has built an incredibly talented organization and laid the foundation for the future success of Windows and our Online Services Business. Over the last 16 years, through everything from his work as head of the company’s worldwide sales, marketing, and services efforts, to his leadership in transforming our field operations and repositioning the company to focus on opportunities in emerging markets, Kevin has played a vital role in this company’s success. There is no doubt that his passion and dedication will be missed.

Effective immediately, Steven Sinofsky, Jon DeVaan, and Bill Veghte will report directly to me to lead Windows/Windows Live. In the Online Services Business, we will create a new senior leadership position and conduct a search that will span internal and external candidates. In the meantime, Satya Nadella will continue to lead Microsoft’s search, ad platform, and MSN engineering efforts, and Brian McAndrews will continue to lead the Advertiser and Publisher Solutions Group. Both Windows/Windows Live and the Online Services Business are led by a strong group of executives on the technical and business side who have the talent and experience to address the challenges we face and drive the next generation of growth and success.

Looking ahead, I see an incredibly bright future for our company. As I said at the June 27th Town Hall for Bill, we are the best in the world at doing software and nobody should be confused about this. It doesn’t mean that we can’t improve, but nobody is better than we are. Nobody works harder than we do. Nobody is more tenacious than we are. We’re investing more broadly and more seriously than anybody else. Our opportunities to change the world have never been greater.

I look forward to working with all of you as we focus on our five priorities in FY09.

Steve