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Ballmer: Microsoft stronger without Bing and Xbox tinkering

Nokia not the new aQuantive, he promises moneymen

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Steve Ballmer has spoken to shareholders of his vision of a diversified Microsoft which includes both Bing and Xbox, with the backing of the tearful Bill Gates.

Ballmer said Tuesday that under the re-org that he announced this summer, Microsoft won’t be limited to a single set of activities, rather it would span “a family of services” for IT pros, business, consumers and channel partners. Services will be delivered via devices.

Ballmer was speaking at the last annual gathering of Microsoft shareholders he is expected to attend ahead of the 21 November release of the Xbox One.

Tuesday was also the day that Nokia shareholders approved the purchase of their company by Microsoft.

“We clearly have big opportunity in devices," said the man El Reg was the first to describe as looking like Uncle Fester. "Just take a look at Xbox One… no other company could have delivered what we are delivering with Xbox One. It is a reflection of what’s possible.”

It emerged last week that one of the candidates for his job as Microsoft chief executive, Nokia CEO Stephen Elop, is open to unloading Xbox and ready to dump perennial lossmaker Bing in order to narrow Microsoft’s focus on business apps.

“This is really a signature moment in the transformation of the company that will bring together the best mobile device work from Microsoft and Nokia,” Ballmer told doubters.

“The realignment of the company that we announced in July is underway,” he added.

“We have moved and are now consolidation from a collection of businesses groups to an organization that’s aligned by function.

“We are operating with a single strategy and starting to work as a single team to a common set of shared goals, high value activities, expressed through devices and services.”

He also tackled the subject of Nokia, raised by one queasy investor, which Microsoft is taking on as a loss-maker and market-share loser. Ballmer was asked to explain how Microsoft could possibly turn that into a successful business.

In answering, the ghost of aQuantive was invoked. aQuantive was one of Ballmer's trademark "big bets" that was supposed to turn Microsoft into an ads publishing and serving powerhouse against Google.

“Certainly, our aQuantive acquisition is not going to go down on the record books as a success. It wasn’t. And I take responsibility for that. I think that we should be mindful and thoughtful and cautious and yet I don’t think we should be fearful about doing somewhat larger acquisitions,” Ballmer said.

Ballmer spent $6.3bn on aQuantive, which was supposed to deliver integrated ads to Xbox Live, Windows Live, Office Live and MSN. aQuantive had actually been a successful and admired operation as an independent company. Microsoft, though, managed to kill it and the company was forced into a $6.2bn write-off in 2012.

Bill Gates, who also spoke at the shareholder meeting, appeared to endorse the Ballmer vision for a diversified Microsoft.

Gates said that in the hunt for a new CEO, he and fellow board member John Thompson want a candidate able to fulfil a "complex role" running a "complex global business". ®

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