Bach Out as Microsoft Entertainment Undergoes Shakeup

Microsoft has reorganized its entertainment section after word that division president Robbie Bach will retire this fall. Combined with news that another very public entertainment figure, J Allard, is leaving the company, Microsoft has been forced to do some major tinkering with the division.

Robbie Bach has been a part of Microsoft for over two decades. The 48-year-old became a prominent part of the company after he helped establish the first Xbox game console, released in 2001, as an industry heavyweight. Unfortunately, other Microsoft devices have not proven so popular under Bach's watch, including the company's mobile phones and music players like the Zune. (Source: cnet.com)

Bach Exit Raises Doubts

Reports say former Microsoft executives are calling Bach's departure proof that the Redmond-based firm is having real trouble in the entertainment and specifically handheld technology market. Microsoft has failed to produce a real contender for the Apple iPhone, and recently Hewlett-Packard announced it would not use Windows 7 on its upcoming Slate tablet computer.

That leaves Microsoft on the outside looking in when it comes to the rapidly-developing tablet market. The company has long been in that position regarding handheld music devices, with the Zune a very, very distant runner-up to the iPod.

In the meantime, Microsoft Chief Executive Officer Steve Ballmer, like a GM who has recently lost his coach, will step in and assume leadership of the entertainment division. He performed a similar role with the Windows division in 2008.

Allard will continue in a relaxed role as a consultant for Ballmer.

Analysts: MS Ignored Entertainment

Microsoft's entertainment division accounts for about 11 per cent of the company's total revenue. Still, it's a weak field for Microsoft, a realm some analysts think has been neglected by the company in favor of Windows and its new search engine, Bing.

"These are all places Microsoft has been before Apple got there," said Michael Gartenberg, an analyst for Altimeter Group. "They're really things that Apple took away from Microsoft." (Source: wsj.com)

It will be up to Ballmer -- and then to the executive he appoints -- to see that those markets are taken back.