These are tough times for Microsoft Corp. CEO Steve Ballmer.
Due to the company’s struggles in the mobile and tablet markets, Microsoft’s brash and outspoken leader did not receive his full bonus for the last fiscal year ending June 30.
Well, that’s not entirely true. Ballmer received 100 per cent of his $670,000 bonus for the year, but it was half the amount he expected to receive (he was eligible to receive a 200 per cent bonus).
According to a U.S. Securities and Exchange Commission filing, Microsoft’s board praised Ballmer for both strong fiscal output and the smooth launch of Windows 7 and Office 2010. But the company said the CEO would have received the additional $670,000 bonus if Microsoft had been successful in gaining mobile market share and creating “innovations to take advantage of new form factors.”
For some bloggers, “new form factors” is code for “release something to compete with the iPad.”
ComputerWorld U.S. blogger Preston Gralla wrote that with the exception of its Bing search engine, Microsoft’s most successful product launches this year were for long-standing products that were already expected to sell well.
“The failures — mobile phones and tablets — are areas in which innovation and vision are required, and where the greatest growth is,” he wrote. “A year from now, if Microsoft doesn’t make a comeback in mobile and successful tablets launched using its operating system, I would expect Ballmer to get even less of a bonus, or worse.”
Minyanville blogger Michael Comeau wrote that for all the things that Microsoft has done right, “like making Google paranoid and disrupting Sony’s crown-jewel PlayStation business,” it still makes most of its money the same way it did 20 years ago.
“Microsoft needs to get its mobile act together because that’s where all the growth in consumer technology is,” he wrote. “This isn’t purely a financial issue — it’s a psychological one as well. The stagnation of Microsoft’s stock through multiple PC bull markets tells us that investors are worried about the company’s future — worries that are now multiplied by the company’s lack of a compelling mobile-device strategy.”
Comeau added that Steve Ballmer is a billionaire many times over, so while this bonus cut will have little impact on his financial outlook, it could actually keep him motivated to make Microsoft succeed. But passion alone doesn’t mean he’s still the right guy for Microsoft, he said.
“Ballmer continuing on as Microsoft’s CEO should be contingent upon the success of the company’s upcoming Windows Phone 7 operating system,” Comeau added.
“If Ballmer can’t get Microsoft in on the fight, he must step aside and give someone else a shot.”
Not surprisingly, bloggers over at the MacDailyNews seemed delighted over the loss of income for Ballmer. The Apple-focused blog wrote that anyone could have foreseen the failure of the Kin.
“That Ballmer couldn’t see it means that he should be … uh, Microsoft CEO for as long as it takes! Yeah, that’s the ticket.”
Ballmer and company will certainly be hoping for a successful Windows Phone 7 launch event — which is slated for later this month — to avoid a similar 100 per cent bonus in fiscal 2011.