Microsoft investors call for Bill Gates' departure

Sources within the company have reported that three major shareholders are worried that Gates' influence might obstruct future changes

Bill Gates is reportedly under pressure to step down as chairman of Microsoft, the company he founded 38 years ago.

Sources familiar with the matter informed Reuters that three of the software giant’s top 20 investors were concerned that Gates wields power that is disproportionate to his declining shareholding.

Although Gates remains the company’s largest single shareholder owning approximately 4.5 per cent of the $277 billion company, he sells around 80 million shares annually under a pre-arranged plan. At this current rate Gates would be left with no financial stake in the software giant by 2018.

The three investors have requested that their identity be kept secret but sources report that they collectively hold more than 5 per cent of the company’s stock.

They are worried that Gates’ position as chairman might limit the power of a new chief executive to make sweeping changes to the company.

Microsoft has begun looking for a new CEO after Steve Ballmer announced in August that he would retire from the position in 12 months’ time. Ballmer made his last company speech to over 13,000 staff last month, tearfully describing Microsoft as “the greatest company in the world.”

Ballmer has long faced pressure from investors to improve the company’s performance and share price but this is the first time that Gates has been targeted in a similar manner.

Gates acted as Microsoft CEO until he passed on the role to Ballmer in 2000, relinquishing his day-to-day duties at the company in 2008 to focus on the Bill & Melinda Gates Foundation, a philanthropic organisation with a $38 billion endowment.

Despite their apparent displeasure with Gates, the investors involved in the campaign are reportedly still keen to carry on with Ballmer’s plans to restructure the company, announced in July. Ballmer called for “one strategy, one Microsoft” with a new focus placed on services and devices.  

This strategy can be most clearly understood through the recent redesigns of Microsoft’s livery, with each of the coloured panes in the company’s logo now corresponding to a key product. Blue represents the Windows operating system; green for Xbox and Xbox Live; red has been assigned to Office, and yellow now stands for Bing.

Microsoft remains one of the world’s most valuable technology companies, reporting a net profit of $22 billion in the last fiscal year. Despite this, many analysts believe that the company failed to anticipate the swing towards mobile devices in the consumer market.

Tablets and smartphones are expected to outsell traditional PCs for the first time ever in the final quarter of 2013, though this will be due primarily to holiday shopping, with PC sales still expected to beat those of mobile devices over next year as a whole.

Microsoft’s attempts to move into the market have so far been underwhelming. The Surface range of tablets launched last year suffered a $900m writedown for unsold inventory, though the devices have been refreshed for 2013.

Microsoft’s mobile platform Windows Phone is still massively outperformed by both Android and iOS in terms of global market share, though recent figures suggest that the OS’s fortunes are on the rise.

Reaction from shareholders to the possible ousting of Gates have been mixed. Todd Lowenstein, a portfolio manager at HighMark Capital Management, which owns Microsoft shares, described it as “long overdue”, whilst Kim Caughey Forrest, a senior analyst at Fort Pitt Capital Group suggested that Gates should in fact be returned to a large role.

"I've thought that the company has been missing a technology visionary," Forrest said. "Bill (Gates) would fit the bill." This sentiment has been echoed by others including tech writer Farhad Manjoo.

Writing for The Independent and Slate, Manjoo argues that Gates should be re-appointed as CEO, saying: “Only he has the institutional authority to liberate Microsoft from the Windows/Office golden noose. Only he could outline some new plan for the firm and command the troops to get in line.”

(additional reporting by agencies)

News
More than 90 years of car history are coming to an end with the abolition of the paper car-tax disc
newsThis and other facts you never knew about the paper circle - completely obsolete today
News
people'I’d rather have Fred and Rose West quote my characters on childcare'
Life and Style
The new Windows 10 Start Menu
tech
Arts and Entertainment
There has been a boom in ticket sales for female comics, according to an industry survey
comedyFirst national survey reveals Britain’s comedic tastes
PROMOTED VIDEO
Life and Style
ebooksA superb mix of recipes serving up the freshest of local produce in a delicious range of styles
Life and Style
ebooksFrom the lifespan of a slug to the distance to the Sun: answers to 500 questions from readers
Travel
Bruce Chatwin's novel 'On the Black Hill' was set at The Vision Farm
travelOne of the finest one-day walks you could hope for - in Britain
Sport
footballManchester City 1 Roma 1: Result leaves Premier League champions in danger of not progressing
Arts and Entertainment
Gay and OK: a scene from 'Pride'
filmsUS film censors have ruled 'Pride' unfit for under-16s, though it contains no sex or violence
News
i100
Life and Style
Magic roundabouts: the gyratory system that has excited enthusiasts in Swindon
motoringJust who are the Roundabout Appreciation Society?
Arts and Entertainment
Hilary North's 'How My Life Has Changed', 2001
booksWell it was good enough for Ancient Egyptians and Picasso...
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Gadgets & Tech

    1st Line Service Desk Analyst

    £27000 - £30000 Per Annum: Clearwater People Solutions Ltd: Our client who are...

    Trainee Recruitment Consultant - Birmingham - Huxley Associates

    £18000 - £23000 per annum + Commission: SThree: Huxley Associates are currentl...

    Trainee Recruitment Consultant - Birmingham - Computer Futures

    £18000 - £23000 per annum + Commission: SThree: Computer Futures are currently...

    Recruitment Consultant - Bristol - Computer Futures - £18-25k

    £18000 - £25000 per annum + Commission: SThree: Computer Futures are currently...

    Day In a Page

    Ebola outbreak: The children orphaned by the virus – then rejected by surviving relatives over fear of infection

    The children orphaned by Ebola...

    ... then rejected by surviving relatives over fear of infection
    Pride: Are censors pandering to homophobia?

    Are censors pandering to homophobia?

    US film censors have ruled 'Pride' unfit for under-16s, though it contains no sex or violence
    The magic of roundabouts

    Lords of the rings

    Just who are the Roundabout Appreciation Society?
    Why do we like making lists?

    Notes to self: Why do we like making lists?

    Well it was good enough for Ancient Egyptians and Picasso...
    Hong Kong protests: A good time to open a new restaurant?

    A good time to open a new restaurant in Hong Kong?

    As pro-democracy demonstrators hold firm, chef Rowley Leigh, who's in the city to open a new restaurant, says you couldn't hope to meet a nicer bunch
    Paris Fashion Week: Karl Lagerfeld leads a feminist riot on 'Boulevard Chanel'

    Paris Fashion Week

    Lagerfeld leads a feminist riot on 'Boulevard Chanel'
    Bruce Chatwin's Wales: One of the finest one-day walks in Britain

    Simon Calder discovers Bruce Chatwin's Wales

    One of the finest one-day walks you could hope for - in Britain
    10 best children's nightwear

    10 best children's nightwear

    Make sure the kids stay cosy on cooler autumn nights in this selection of pjs, onesies and nighties
    Manchester City vs Roma: Five things we learnt from City’s draw at the Etihad

    Manchester City vs Roma

    Five things we learnt from City’s Champions League draw at the Etihad
    Martin Hardy: Mike Ashley must act now and end the Alan Pardew reign

    Trouble on the Tyne

    Ashley must act now and end Pardew's reign at Newcastle, says Martin Hardy
    Isis is an hour from Baghdad, the Iraq army has little chance against it, and air strikes won't help

    Isis an hour away from Baghdad -

    and with no sign of Iraq army being able to make a successful counter-attack
    Turner Prize 2014 is frustratingly timid

    Turner Prize 2014 is frustratingly timid

    The exhibition nods to rich and potentially brilliant ideas, but steps back
    Last chance to see: Half the world’s animals have disappeared over the last 40 years

    Last chance to see...

    The Earth’s animal wildlife population has halved in 40 years
    So here's why teenagers are always grumpy - and it's not what you think

    Truth behind teens' grumpiness

    Early school hours mess with their biological clocks
    Why can no one stop hackers putting celebrities' private photos online?

    Hacked photos: the third wave

    Why can no one stop hackers putting celebrities' private photos online?