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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: taxman who wrote (18012)	3/14/1999 4:49:00 PM
From: Ian Davidson	Respond to of 74651

dailynews.yahoo.com Sunday March 14 1:30 AM ET Microsoft To Unveil Reorganization In 'Near Future' By Martin Wolk SEATTLE (Reuters) - Microsoft Corp. (Nasdaq:MSFT - news) plans to unveil a long-awaited reorganization soon that will include new leadership for its struggling MSN division and a closer focus on customer groups. Microsoft Chief Operating Officer Bob Herbold, responding to a question at a shareholders meeting, said the reorganization plan would be announced formally in the ''near future,'' although he declined to give details. The plan, first disclosed by The Seattle Times more than a month ago, would divide the company into four main divisions focusing on consumers, developers, enterprise customers and ''knowledge workers'' rather than its current organization based on product groups. The realignment had been expected to be finalized by now, but Microsoft President Steve Ballmer apparently has had trouble with a key component: finding an executive to take over the company's online efforts, including the msn.com portal site. Ballmer has been acting chief of the division since December when group Vice President Pete Higgins left to take a personal leave of absence. ''They need a key player in that position, and I'm sure that is a high priority for Ballmer,'' said Mike Kwatinetz, an analyst with Credit Suisse First Boston. ''They do have some very good things to build around, but there's been nobody who has been able to really crystallize things.'' While msn.com has risen to the No. 3 consumer site on the Web since its relaunch as a portal site last year, the division has had to change course frequently in an effort to keep from being badly outflanked by rivals including America Online Inc. (NYSE:AOL - news) and Yahoo Inc. (Nasdaq:YHOO - news) ''They're still playing catch-up,'' Kwatinetz said. Brad Silverberg, the Microsoft executive who headed development of the Windows 95 operating system but has been on leave since 1997, had been considered a leading candidate to head the consumer division including MSN, but he has turned down the job, as have executives from several leading Internet companies, according to The Wall Street Journal. The latest plan is to divide responsibility for the consumer division between Jon DeVaan, a vice president in charge of Microsoft's Office applications, and Brad Chase, vice president for Windows marketing and developer relations, the newspaper reported. A Microsoft spokeswoman declined to comment on the report. Jim Balderston, an analyst at Zona Research, said the reorganization could help Microsoft respond to rapidly changing markets. Microsoft is faced with a problem companies face when they get fairly large,'' he said. ''There can be a sort of an inertia that creeps in. The chain of command gets really long. That can slow not only decision-making but also dampen people's initiative.'' While Microsoft has responded well in the past to the challenges of the Internet, that is no guarantee it will in the future, he said. The planned reorganization is not related to Microsoft's antitrust trial in Washington, currently in recess, company officials said. If Microsoft loses, government prosecutors could seek a much more radical restructuring dividing the company into several stand-alone pieces. Microsoft, which late Thursday announced plans to shift about $400 million in revenue into its fiscal fourth quarter, fell $1.25 to close at $160.19 in heavy Nasdaq trading. Shareholders authorized the company to issue more shares to accommodate a stock split effective March 26. Earlier Stories 3Com And Microsoft Team To Develop Networking Products (March 12) Microsoft CFO Comfortable With Q3 Earnings Estimates (March 11) 3Com And Microsoft To Develop Networking Products (March 11) Microsoft Unveils System To Promote Internet In China (March 10) Justice, Microsoft Not In Talks - Source (March 10)