Microsoft names Sinofsky as Windows head

By Daisuke Wakabayashi

SEATTLE- Microsoft Corp. replaced the top manager of its core Windows business, promoting an executive from its Office business software unit two days after announcing a delay in its next-generation Vista operating system.

Steven Sinofsky will assume leadership of an operating system division beset by delays and missed deadlines, taking responsibility for future Windows products after current head Jim Allchin retires next year.

The change is effective immediately, but Allchin will continue to oversee development of Windows Vista. Allchin announced last year that he planned to retire once Microsoft finished the upgrade to its ubiquitous operating system.

Earlier this week, the world's largest software maker said it would delay the consumer launch of the new Windows until early next year, after the holiday shopping season peak. Windows accounts for the largest portion of Microsoft's sales and profit.

Sinofsky developed a reputation as a no-nonsense taskmaster during his time at the Office business by consistently meeting deadlines and rolling out new products on a regular schedule, company-watchers say.

"The Office group is known for running a pretty tight ship, so if he can bring more discipline, that could be very beneficial to future versions of Windows," said Joe Wilcox, analyst at Jupiter Research.

Microsoft had originally been expected to release Windows Longhorn, now Vista, in 2005. The company scaled back its ambitions and pushed it out to the second-half of 2006 before the latest delay.

Sinofsky will be in charge of engineering future Windows operating systems and its upcoming Windows Live. Microsoft plans to unite its Web-based software and services, such as e-mail, instant messaging and computer virus detection at its Windows Live site to complement the core operating system.

The shake-up follows a large reorganization within Microsoft last year when it consolidated seven business groups into three, picking Kevin Johnson and Allchin to lead its platforms and services division, which includes the Windows business and the company's MSN Internet unit.

After Allchin retires, Johnson will assume responsibility for the segment. The Redmond, Washington-based company said it now plans to split that division into eight operating groups.

As part of those eight businesses, Microsoft created a new Windows Live Platform Group, Online Business Group, and Market Expansion Group in addition to the Windows and Window Live Group headed by Sinofsky.

The Windows Live Platform Group will build Microsoft's online services and be headed by Blake Irving.

The Online Business Group will oversee advertising sales and business development and marketing for Windows Live with David Cole at the helm. Cole plans to take a one-year leave starting in April and the company plans to name a successor.

The Market Expansion Group will focus on emerging markets and creating new forms of PCs, such as the recently launched Ultra Mobile PC. Will Poole will head this group.

Shares of Microsoft fell 33 cents, or 1.2 percent, to $26.82 in afternoon Nasdaq trade, extending losses since the company announced the delay for Vista.