Microsoft shakes up consumer business with the departure of Bach and Allard

Microsoft announced a major shake up of its Entertainment & Devices Division on Tuesday.

Both Robbie Bach and J Allard, the men behind Xbox and Zune, are departing the company. The departures signal a massive reorganization for Microsoft's management of its struggling mobile division and Xbox/Zune devices. Rumours suggested that Allard's departure was due to the Microsoft Courier project cancellation but in an interview with TechFlash he denied this and also confirmed he doesn't plan to work for Apple, Google or any other Microsoft rival.

“J has brought a game-changing creative magic to Microsoft for years, from Windows to Xbox, from Zune to KIN,” Ballmer said. “He was one of the key drivers in our early work on the Web, and we’re absolutely delighted that J’s role with the company will evolve in a way that lets all of Microsoft benefit from his business insight, technical depth and keen eye for consumer experience.”

Bach, President of the Entertainment & Devices Division, will not be replaced. This leaves the current Xbox and Windows Mobile leaders to report to Ballmer starting on July 1. This broader restructuring will give CEO Steve Ballmer more control of Microsoft's consumer products like Xbox and Windows Phone. “For the past 22 years, Robbie has personified creativity, innovation and drive. With this spirit, he has led a division passionately devoted to making Microsoft successful in interactive entertainment and mobility,” Ballmer said. “Robbie’s an amazing business person and close personal friend, which makes his departure a point of sadness for me. However, given the strong leadership team he has built, the business performance of E&D this year and the launches of Windows Phone 7 and ‘Project Natal’ this fall, we are set up well for success as we continue to drive our mobile and entertainment businesses forward.”

So what does this huge shake up mean for consumers? Microsoft has been struggling to compete with Apple's iPhone and Google's Android devices in the mobile space. Consumer awareness of both competing platforms and mindshare focus has shifted to iPhone and Android devices. HTC, once a huge backer of Windows Mobile, has moved the majority of its high end products to Google's platform until Windows Phone 7 arrives. If the shake up works then consumers can expect to see great advances with Windows Phone, Xbox and Zune. Both Windows Phone and Zune have struggled to hold or gain market share in the U.S. 2010 is set to be a strong year for the Xbox as game makers continue to release the top games on the platform. Microsoft is also planning to release the Project Natal controllerless game system for the Xbox 360 later this year.

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22 Comments

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I bought one and it's still kicking after almost 4 years, The zune is the best media player I've used so far, better U.I and the construction is top notch. I also have a red zune 80 and plan to get a zune HD 64 in the near future as well as a windows phone 7 when they drop.

Some of use fallow our own path and like the being different. zune ftw!!

Microsoft makes money off of HTC whether they use Android or WM due to their agreement to go ahead and pay so microsoft doesn't sue due to patent infringement.

Currently, I think windows phone isn't that great, but in another release it will probably be a good contender.

The Kin is really a disappointment with verizon's data pricing and was probably just a test more than an actual product.

It would be really hard for them to mess up the current xbox 360 considering that the games really make the console. Anything they do on top of the already released 360 will just add a bit more revenue and not detract anything existing. I'm really interested to see how they'll cope with needing a larger sized disc in a year or so for the next version.

The entertainment division needs younger more up with the times people...so i am hoping that they get people who can make cool devices...IMO this could be a good thing...

I am hoping it's not a case of out with the old in with the old...BS.

yardman said,
The entertainment division needs younger more up with the times people...so i am hoping that they get people who can make cool devices...IMO this could be a good thing...

I am hoping it's not a case of out with the old in with the old...BS.

Robbie Bach was actually quite new school in the scheme of things. He is essentially the entire reason the Xbox exists (known internally as the valentines day massacre)... Ballmer was trying to argue that the Xbox should be based off Windows and not a branch of the kernel but Bach went to bat for his staff and said if that's the route they are going, then his division isn't interested in participating in it.

I think there is a difference between a good manager and needing some fresh blood. The people who can guide their divisions strategic vision and have faith in their are a rare commodity nowadays.

yardman said,
The entertainment division needs younger more up with the times people...so i am hoping that they get people who can make cool devices...IMO this could be a good thing...

I am hoping it's not a case of out with the old in with the old...BS.

While I somewhat agree with you, I don't really agree that the person needs to be younger. I find a lot of younger people aren't as good as people who've experienced the industry. I think anyone who's fit for the position with proper experience/skills AND is very aware of the current consumer market would be good... not necessarily a younger person

Well.. i for one think this its a tragedy that these 2 are leaving.. im sure theres alot more beneath the surface than we know..

Microsoft need to rethink its consumer orientated strategy and get some proper focus going on putting out something new and exciting atleast every 2 years.. whats the last cool thing that came out of Microsoft?

Other than Windows 7!!!!! and this project Natal nonsense!

Bing Maps? Zune HD?

And seriously, who demands examples of cool things from a company but rules out a MAJOR project like Windows 7? That's like, their flagship consumer project. Even if ALL THEY DID was Windows, Windows 7 would still count as something cool.

/weirdo

dimithrak said,
Well.. i for one think this its a tragedy that these 2 are leaving.. im sure theres alot more beneath the surface than we know..

Microsoft need to rethink its consumer orientated strategy and get some proper focus going on putting out something new and exciting atleast every 2 years.. whats the last cool thing that came out of Microsoft?

Other than Windows 7!!!!! and this project Natal nonsense!

Care to explain how is Project Natal is nonsense? Are you even aware of how excited people are to get their hands on it? I think it's going to be the next great thing for Xbox.

The Zune HD and the upcoming Windows Phone 7 are very amazing.. I've had Apple-fanboy friends who used to be so hardcore iPod/Phone, and when they got their hands on my Zune HD.. they wanted one for themselves... The problem is they need to bring the Zune HD international and market it more.. it would really do amazing.. people just need to be aware of it.. because really it is better than the iPod/iPhone and the previous gen Zunes.

@j2006 @Joshie

ok.. i wouldnt say nonsense.. but comon.. how many people are going to use their entire body for gaming purposes.. people who use the wii hardly get off their chair..

anyways.. it will be just like the wii.. its great.. but will die down

I just believe with the transition of devices into the more mobile environment and more people starting to experience stable products from google, apple and even from the ubuntu folks.. i believe Microsoft need something more than Windows as their flagship.. it will not remain their flagship for ever..

I just feel their Microsoft is behind in so many ways...... they are too dependent on office and windows..

dimithrak said
how many people are going to use their entire body for gaming purposes.. people who use the wii hardly get off their chair..

It's more than just controlling the games. it's controlling the entire experience with your body, and voice!

I for one would love to have my system automatically boot and log me into xbox live simply by walking in front of the device.
Plus navigating the dashboard, netflix, zune and media center extender (live TV) with simple voice+gesture would be interesting moving forward.

Edited by deadonthefloor, May 26 2010, 7:38pm :

In the email to the employees, Allard had mentioned that 95% he would spend time for his life (bike riding etc..) and 5% directly with Steve Ballmer...
Hopefully Bach unit wasnt doing good at all...now let it be free & Xbox, WP7 move well ahead with good reputation as we got with Win7.

Robbie was an amazing guy and I'm sorry to see him go. The few times I have spoken with him he always been very polite, open and not without a sense of humour.

It will be interesting to see how this affects the future vision for E&D.

asdavis10 said,
Seems like they go through an organizational restructuring every year. Microsoft is losing its way.

No. Bach took over in 2005 and is leaving on a highnote after doing his job in regards to the Xbox brand and XBL.