On June 15, Bill Gates
announced that he was relinquishing day-to-day management of the company in two years. This announcement will provide enough time for the market and employees to prepare for the event. Although this may come as a surprise to many outsiders, it has been rumored that, within the company, BillG was simply acting as a sounding board to various product divisions. Given his history with the industry and their products, he has made strategic decisions around interoperability that gave the Windows franchise control over the industry. This strategy, while giving it great success over the years, is beginning to fade with the arrival of Web 2.0 represented by Google, Salesforce.com and others. Microsoft’s acquisition of Groove added a key weapon to its competitive arsenal -- Ray Ozzie. Given Ozzie's experience with peer to peer software, he is a natural champion for the software as a service (Live) agenda. This requires the company to rethink Windows as the architecture control point and begin to transform itself to create new sources of control and value appropriation. With BillG moving on, it gives Ozzie the chance to conceptualize and create the new source of competitive advantage for Microsoft.