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New Era of Technical Leadership at Microsoft

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BILL GATES: In terms of my being chairman, obviously I serve at the pleasure of the board, in that they elect the shareholders elect directors, and then the directors decide who the chairman will be. We had the board call on Tuesday and were nice enough to say that, at least as far as the present directors are concerned, they'd like to see me do that indefinitely. And that's my plan, I don't see a time in the future when I won't be the chairman of the company. I want to have that association my entire life, and so I'm committed to do that. Subject to those processes, I'll stay in that role.

STEVE BALLMER: Certainly Bill and I had begun the discussion about his future and the future of the company by the time we acquired Groove. We acquired Groove two things, number one it was a great product, great technology, it enhanced the collaborative capability of our Office product suite. And number two, we'd wanted to work with Ray for about 20-plus years. So that was also a benefit, of course. It's been great the way it has worked, having Ray here. We expected a lot, and things have worked out even better than we probably had any right to expect. When we talked to Ray about taking on this assignment, we were glad he was interested.

QUESTION: There's been some concern among investors, and even some of your own employees about whether Microsoft can keep pace with the rapid pace of innovation. Some of your competitors in the software landscape really makes a big change in the next couple of years. Bill, the direction of innovation at this company has always been, for the entire history of the company, your area. Should people be concerned with your departure, what kind of signal does that send to them?

BILL GATES: I'd say that any view that the innovation comes primarily from me really reflects that notion that there's been an over-focus on my individual contribution. I love what I do, I think I've had some real impact, but if you look at the innovations, and you name any products, form Office to Windows, SQL, Exchange, Xbox, I'm not the primary person in any sense on those things. There are amazing people that will get even increasingly visibility for the great work they do, including many of the people that were called out in my remarks.

So this company from all its different groups has plenty of brilliant IQ about innovative software. There are a few of the things that I do that are important, like the architectural alignment of the various activities, and that's what over the next two years Ray and I will do together, and subsequent to that Ray will take that on as his sole responsibility. So we've really gone carefully through the things that I actually do, not what is written that I do, and said how to make sure that those get taken on. And I feel great about how Ray and Craig, but also the extra autonomy of the divisions are going to fill in for all the things that, in fact, I did as my full-time role. Then what I'm doing as chairman in my part-time role, just would come in and be available on top of that.

STEVE BALLMER: I would think about Office 2007 or Xbox as proxies. There were teams of people that created the vision for those products, engineered those products, made them happen, and sure, Bill gave him his suggestions, and insight, and advice, but Steven Sinofsky and his team, Jay Allard and his team, those are the folks who really create that work. And I think we can be proud of what they've accomplished, and confident in what they'll accomplish in the future.

QUESTION: (inaudible) and what will your role be at the foundation?

BILL GATES: First, I'm not leaving Microsoft. I will be chairman, have a very strong connection, and spend meaningful time here helping out. So now it's not what's happening now is we're starting this transition plan. To be clear, except for a little vacation this summer, longer than normal, I'm here working as hard as I ever have during these next two years. So it's really July 2008 that's kind of the date of change. At that time I expect the foundation will have grown in some pretty substantial ways, and that the value of my time there to help shape things will be really quite great. So I felt the need to put more time into that. That's why Steve and I have had this dialogue and I reached the decision a couple of days ago.

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